Bankr. No.:
97-10001
Chapter:
12
Date of Decision:
February 25, 2004
Issue:
(1) Whether Debtors may modify their confirmed plan to alter the payments on a Shared Appreciation Agreement with FSA for which the original first date to repay the debt under the agreement fell outside the plan term? (2) Whether Debtors’ case should be dismissed for their failure to complete plan payments where they had not repaid their debt to FSA under the Shared Appreciation Agreement?
Ruling:
(1) Debtors’ motion to modify was denied because § 1229(c) prohibits a Chapter 12 debtor from modifying a confirmed plan to change the repayment terms for a long-term debt, which included the Shared Appreciation Agreement with FSA. (2) The motion to dismiss was denied. The debt under the Shared Appreciation Agreement was to be paid outside the plan term so Debtors did not have to pay it before receiving their general discharge. The Shared Appreciation Agreement debt, however, would be excluded from the discharge.
Full Bankruptcy Court Decision:
