In re Reiser
In re Reiser
Opinion of the Court
MEMORANDUM DECISION
This matter comes before the Court on motion of CAB West LLC, as serviced by Ford Motor Credit Company LLC (“CAB West” or the “movant”). CAB West seeks either allowance of an administrative expense priority claim under 11 U.S.C. § 503(b) or dismissal of the case under 11 U.S.C. § 1307(c)(6). The debtor, Dawn Marie Reiser (“the debtor” or “Ms. Reiser”), filed an objection, as did the chapter 13 trustee, Gregory A. Burrell. A hearing on the motion was held on May 18, 2017, after an order confirming the debtor’s modified post-confirmation chapter 13 plan was docketed, on May 4, 2017. Bradley J. Hal-berstadt represents CAB West. Nicole Anderson represents the debtor. Jeffrey M. Bruzek represents the chapter 13 trustee. Based on the record, the matter is ready for disposition.
This memorandum decision constitutes the Court’s findings of facts and conclusions of law under Fed. R. Bankr. P. 7052, made applicable to contested matters under Fed. R. Bankr. P. 9014(c). The Court has jurisdiction here through 28 U.S.C. §§ 1334 and 157. This matter qualifies as a
The Background
The necessary background information is straightforward. Ms. Reiser leased a 2014 Ford Edge from CAB West.
The unopposed, confirmed plan now in force treats the claims of the debtor’s creditors. In relation to the movant, the plan states in part:
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ECF No. 38. By its terms, “cure provi- plan].” Paragraph 7 goes on to state: sions, if any, are set forth in ¶ 7 [of this
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Id. Paragraph 9 of this plan handles the der 11 U.S.C. § 507: treatment of claims entitled, to priority un-
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Id, The plan reshaped the relationship of rights as between Ms. Reiser and the mov-ant, as well as her other creditors. Yet, the movant filed a motion seeking to sculpt its rights after the clay had already hardened — by way of plan confirmation.
The Court confirmed the modified post-confirmation plan on May 4, 2017, and the movant’s hearing on this motion
The Issue
With some exceptions, section 1327 of the Bankruptcy Code binds the debtor and her creditors to the terms of a confirmed chapter 13 plan. Here, a confirmed chapter 13 plan exists. May the movant nevertheless achieve administrative expense claimant status under § 503(b)(1)(A), even though the confirmed chapter 13 plan does not provide for that treatment?
The Binding Effect of a Confirmed Chapter 13 Plan
Section 1327(a) of the Bankruptcy Code is the fountainhead for the binding effect of a confirmed chapter 13 plan. 11 U.S.C. § 1327(a). The Bankruptcy Code supplies this binding effect through these words: “(a) The provisions of a confirmed plan bind the debtor and each creditor, whether or not the claim of such creditor is provided for by the plan, and whether or not such creditor has objected to, has accepted, or has rejected the plan,” Id.
Courts have illumined with insight the effect of § 1327(a). In IMPAC Funding Corp. v. Simpson (In re Simpson), the Bankruptcy Appellate Panel for the Eighth Circuit identified that, “The Eighth Circuit has noted that the binding effect of a confirmed plan may result in res judicata on claims that were or could have been decided in the confirmation process.” 240 B.R. 559, 561 (8th Cir. BAP 1999) (citing Harmon v. United States, 101 F.3d 574, 582-83 n. 5 (8th Cir. 1996). After, in In re Simpson, the court catalogued cases, including one that discusses the binding effect of a confirmed chapter 13 plan, as “a tenet of res judicata,” and others that discuss the effect without reliance upon res judicata. Id. at 561-62. The court then extracted this kernel of law from those cases:
The sum of the judicial decisions that have considered the statutorily binding effect of a confirmed plan of reorganization is that if the confirmed plan treats the creditor, and if the creditor received proper notice of the plan and its proposed confirmation, the creditor’s only potential remedy for a plan it doesn’t like is to appeal the order of confirmation.
Id. at 562; see also, In re Siemers, 205 B.R. 583, 586 (Bankr. D. Minn. 1997) (“If a creditor doesn’t like the treatment of its claim under the terms of a proposed plan, the creditor’s remedy is to object to confirmation, not to ignore the plan and try to attack it later.”).
Conclusion
For the foregoing reasons, CAB West is not entitled to an administrative expense claim under 11 U.S.C. § 503(b)(1)(A). The terms of the confirmed chapter 13 plan bind CAB West.
Accordingly, the movant’s motion for allowance of an administrative priority expense claim, or for case dismissal, is DENIED.
IT IS ORDERED.
. No party disputes that the debtor surrendered the vehicle to the movant in January of 2017.
. Unless stated otherwise, references to the "Bankruptcy Code" or to specific statutory sections in this memorandum decision are to 11 U.S.C. §§ 101-1532.
. CAB West attached the debtor’s now confirmed chapter 13 plan as exhibit C to its motion. ECF No. 40 at 8-10.
.The movant calculated $3,602.86 by the addition of $582.40 for "Excessive Wear/Tear,” $1,292.86 for "Payments Owed,” $1,579.00 for "Excess Mileage Charge,” and $148.60 for "Taxes.” ECF No. 40 at 2. [$582.40 + $1,292.86 + $1,'579.00 + $148.60 = $3,602.86], ["Excessive Wear/Tear” + "Payments Owed” + "Excess Mileage Charge" + “Taxes” = Total], Id.
. The binding effect of a confirmed chapter 13 plan is not boundless. There are limited, recognized exceptions to this binding effect. See, e.g., Hon. Joan N. Feeney, Hon. Michael G. Williams & Michael J. Stepan, Bankruptcy Law Manual § 13:44 (5th ed. 2017) ("In general, a final order confirming the plan is binding as to the rights and liabilities of all creditors, unless confirmation is revoked under § 1330, the case is converted or dismissed under § 349, or there are due process defects in the notice of the plan. Where a plan fails to provide adequate notice and specificity of the proposed treatment of a claim, it will not be given binding effect.”) (citations omitted) (collecting cases). A discussion of the application of each of those exceptions will ensue.
There can be no sustainable argument that any of the recognized exceptions apply to CAB West. No revocation of the confirmed plan occurred under § 1330. There has been no conversion or dismissal of the case under
Opinion of the Court
MEMORANDUM DECISION
This matter comes before the Court on motion of CAB West LLC, as serviced by Ford Motor Credit Company LLC (“CAB West” or the “movant”). CAB West seeks either allowance of an administrative expense priority claim under 11 U.S.C. § 503(b) or dismissal of the case under 11 U.S.C. § 1307(c)(6). The debtor, Dawn Marie Reiser (“the debtor” or “Ms. Reiser”), filed an objection, as did the chapter 13 trustee, Gregory A. Burrell. A hearing on the motion was held on May 18, 2017, after an order confirming the debtor’s modified post-confirmation chapter 13 plan was docketed, on May 4, 2017. Bradley J. Hal-berstadt represents CAB West. Nicole Anderson represents the debtor. Jeffrey M. Bruzek represents the chapter 13 trustee. Based on the record, the matter is ready for disposition.
This memorandum decision constitutes the Court’s findings of facts and conclusions of law under Fed. R. Bankr. P. 7052, made applicable to contested matters under Fed. R. Bankr. P. 9014(c). The Court has jurisdiction here through 28 U.S.C. §§ 1334 and 157. This matter qualifies as a
The Background
The necessary background information is straightforward. Ms. Reiser leased a 2014 Ford Edge from CAB West.
The unopposed, confirmed plan now in force treats the claims of the debtor’s creditors. In relation to the movant, the plan states in part:
[[Image here]]
ECF No. 38. By its terms, “cure provi- plan].” Paragraph 7 goes on to state: sions, if any, are set forth in ¶ 7 [of this
[[Image here]]
Id. Paragraph 9 of this plan handles the der 11 U.S.C. § 507: treatment of claims entitled, to priority un-
[[Image here]]
Id, The plan reshaped the relationship of rights as between Ms. Reiser and the mov-ant, as well as her other creditors. Yet, the movant filed a motion seeking to sculpt its rights after the clay had already hardened — by way of plan confirmation.
The Court confirmed the modified post-confirmation plan on May 4, 2017, and the movant’s hearing on this motion
The Issue
With some exceptions, section 1327 of the Bankruptcy Code binds the debtor and her creditors to the terms of a confirmed chapter 13 plan. Here, a confirmed chapter 13 plan exists. May the movant nevertheless achieve administrative expense claimant status under § 503(b)(1)(A), even though the confirmed chapter 13 plan does not provide for that treatment?
The Binding Effect of a Confirmed Chapter 13 Plan
Section 1327(a) of the Bankruptcy Code is the fountainhead for the binding effect of a confirmed chapter 13 plan. 11 U.S.C. § 1327(a). The Bankruptcy Code supplies this binding effect through these words: “(a) The provisions of a confirmed plan bind the debtor and each creditor, whether or not the claim of such creditor is provided for by the plan, and whether or not such creditor has objected to, has accepted, or has rejected the plan,” Id.
Courts have illumined with insight the effect of § 1327(a). In IMPAC Funding Corp. v. Simpson (In re Simpson), the Bankruptcy Appellate Panel for the Eighth Circuit identified that, “The Eighth Circuit has noted that the binding effect of a confirmed plan may result in res judicata on claims that were or could have been decided in the confirmation process.” 240 B.R. 559, 561 (8th Cir. BAP 1999) (citing Harmon v. United States, 101 F.3d 574, 582-83 n. 5 (8th Cir. 1996). After, in In re Simpson, the court catalogued cases, including one that discusses the binding effect of a confirmed chapter 13 plan, as “a tenet of res judicata,” and others that discuss the effect without reliance upon res judicata. Id. at 561-62. The court then extracted this kernel of law from those cases:
The sum of the judicial decisions that have considered the statutorily binding effect of a confirmed plan of reorganization is that if the confirmed plan treats the creditor, and if the creditor received proper notice of the plan and its proposed confirmation, the creditor’s only potential remedy for a plan it doesn’t like is to appeal the order of confirmation.
Id. at 562; see also, In re Siemers, 205 B.R. 583, 586 (Bankr. D. Minn. 1997) (“If a creditor doesn’t like the treatment of its claim under the terms of a proposed plan, the creditor’s remedy is to object to confirmation, not to ignore the plan and try to attack it later.”).
Conclusion
For the foregoing reasons, CAB West is not entitled to an administrative expense claim under 11 U.S.C. § 503(b)(1)(A). The terms of the confirmed chapter 13 plan bind CAB West.
Accordingly, the movant’s motion for allowance of an administrative priority expense claim, or for case dismissal, is DENIED.
IT IS ORDERED.
. No party disputes that the debtor surrendered the vehicle to the movant in January of 2017.
. Unless stated otherwise, references to the "Bankruptcy Code" or to specific statutory sections in this memorandum decision are to 11 U.S.C. §§ 101-1532.
. CAB West attached the debtor’s now confirmed chapter 13 plan as exhibit C to its motion. ECF No. 40 at 8-10.
.The movant calculated $3,602.86 by the addition of $582.40 for "Excessive Wear/Tear,” $1,292.86 for "Payments Owed,” $1,579.00 for "Excess Mileage Charge,” and $148.60 for "Taxes.” ECF No. 40 at 2. [$582.40 + $1,292.86 + $1,'579.00 + $148.60 = $3,602.86], ["Excessive Wear/Tear” + "Payments Owed” + "Excess Mileage Charge" + “Taxes” = Total], Id.
. The binding effect of a confirmed chapter 13 plan is not boundless. There are limited, recognized exceptions to this binding effect. See, e.g., Hon. Joan N. Feeney, Hon. Michael G. Williams & Michael J. Stepan, Bankruptcy Law Manual § 13:44 (5th ed. 2017) ("In general, a final order confirming the plan is binding as to the rights and liabilities of all creditors, unless confirmation is revoked under § 1330, the case is converted or dismissed under § 349, or there are due process defects in the notice of the plan. Where a plan fails to provide adequate notice and specificity of the proposed treatment of a claim, it will not be given binding effect.”) (citations omitted) (collecting cases). A discussion of the application of each of those exceptions will ensue.
There can be no sustainable argument that any of the recognized exceptions apply to CAB West. No revocation of the confirmed plan occurred under § 1330. There has been no conversion or dismissal of the case under
Case-law data current through December 31, 2025. Source: CourtListener bulk data.