Brown v. Beaver (In re Brown)

Case Type:
Consumer
Case Status:
Affirmed
Citation:
NV-16-1099-KuLJu (9th Circuit, Mar 27,2017) Not Published
Tag(s):
Ruling:
Bankruptcy court's order dismissing debtor's chapter 13 case for lack of eligibility affirmed.
Procedural context:
Appeal from the Bankruptcy Court for the District of Nevada; reviewed de novo.
Facts:
Debtor settled with creditors by agreeing to make 15 years of payments in the aggregate sum of $171,000. Settlement provided that if debtor defaulted and failed to cure, creditors could cause to be entered and enforced a $500,000 stipulated nondischargeable judgment against debtor. Debtor defaulted and, before the cure period ran, filed for chapter 13 bankruptcy. Creditors filed motion to dismiss case based on ineligibility for chapter 13 under § 109(e). Bankruptcy court determined that, under the settlement agreement, debtor's obligation was $500,000 that could be reduced to $171,000 only if debtor complied with settlement payment terms. Bankruptcy court concluded that debt was neither contingent nor unliquidated at the time of the chapter 13 filing. BAP affirmed, holding that debt owed to creditors was nondischargeable in the amount of $500,000, subject to a condition subsequent: if debtor timely paid the $171,000, the entire nondischargeable obligation would be deemed satisfied.
Judge(s):
Kurtz, Lafferty, Jury

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