Bankr. No.:
88-10093
Chapter:
12
Date of Decision:
September 6, 1990
Issue:
(1) Whether the debtors are obligated to pay disposable income under the "ability to pay test" of 11 U.S.C. § 1225(b)(1) when the "best interest of creditors" test of 11 U.S.C. § 1225(a)(4) has been met? (2) Whether the standing Chapter 12 trustee has the burden to show the amount of disposable income the debtors should pay under 11 U.S.C. § 1225(b)(1).
Ruling:
(1) The debtors are obligated to pay disposable income under the "ability to pay test" of 11 U.S.C. § 1225(b)(1) even though the "best interest of creditors" test of 11 U.S.C. § 1225(a)(4) has been met. (2) While the standing Chapter 12 trustee or objecting creditor has the burden to produce satisfactory evidence that the debtor is not applying all of his disposable income to the plan (if the trustee or creditor has objected to discharge or has moved for dismissal), the debtor has the ultimate burden of persuading the Court that appropriate payments have been made.
Full Bankruptcy Court Decision:
