Friday, December 15, 2006

Branigan v. Kahn & Kranigan v. Bateman (Maryland U.S.D.C.)(not approved for publication)

Filed December 14, 2006--Opinion by Judge Deborah K. Chasanow (not approved for publication)

Chapter 13 Trustee appealed orders of the bankruptcy court denying his motions to dismiss and confirming the plans of the debtors. Where each debtor obtained a discharge in bankruptcy within a certain interval of filing and as a result, each is ineligible to obtain a discharge, the sole issue is whether 11 U.S.C. §1328(f), which prohibits a second discharge under certain circumstances, also prohibits the filing of a chapter 13 petition.

In rejecting the Trustee's contention that the ineligibility to obtain a discharge should mean that the debtor is also ineligible to file the petition at all and that the filing is, ipso facto, in bad faith the court held:

While there are some limitations on that general grant of eligibility, see, e.g., §109(g), there is no prohibition based on the inability to be granted a discharge or the fact that the debtor is a serial filer. Indeed, the Supreme Court long ago found that serial filing was not necessarily barred.

Congress has expressly prohibited various forms of serial filings. The absence of a like prohibition on serial filings of Chapter 7 and Chapter 13 petitions, combined with the evident care with which Congress fashioned these express prohibitions, shows that Congress did not intend categorically to foreclose the benefit of Chapter 13 reorganization to a debtor who previously has filed for Chapter 7 relief.

The full opinion is available in PDF.

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