Bankr. No.:
87-10109
Adv. No.:
90-1005
Chapter:
12
Date of Decision:
February 15, 1991
Issue:
(1) Is a Chapter 12 debtor's post confirmation settlement of a lawsuit subject to Bankruptcy Court approval under Bankr. R. 9019(a)? (2) Are post confirmation, pre discharge proceeds of a lawsuit income available for payments under a confirmed Chapter 12 plan?
Ruling:
: (1) No. A Chapter 12 debtor's post confirmation settlement of a lawsuit is not subject to Bankruptcy Court approval pursuant to Bankr. R. 9019(a). The settlement may be scrutinized by the Court, however, upon a motion to dismiss or objection to discharge if there are allegations of fraud or gross mismanagement that is prejudicial to creditors. (2) Yes. Post confirmation, pre discharge proceeds of a lawsuit should be made available by the debtors for Chapter 12 plan payments.
Full Bankruptcy Court Decision:
