Free v. Malaier (In re Free)
- Summarized by David Hercher , U.S. Bankruptcy Court, District of Oregon
- 10 years 2 months ago
- Citation:
- In re Free, No. WW-14-1395-JuKiF (9th Cir. B.A.P. Dec. 17, 2015)
- Tag(s):
-
- Ruling:
- In personam liability on undersecured debt that is discharged in chapter 7 is not counted toward the unsecured-debt limit in a subsequent chapter 13 case.
- Procedural context:
- Debtors filed a chapter 7 petition and scheduled over-encumbered real property. After entry of their discharge, they filed a chapter 13 petition. Chapter 13 trustee moved to dismiss the case on the ground that debtors' unsecured debt included the unsecured portion of the undersecured debt discharged in their chapter 7 case and thus exceeded the section 109(e) unsecured-debt limit. The bankruptcy court granted trustee's motion to dismiss. On appeal, the BAP reversed.
- Facts:
- The unsecured portion of an undersecured claim is discharged by a chapter 7 discharge and thus is not counted toward the unsecured-debt limit in a subsequent chapter 13 case.
- Judge(s):
- Meredith A. Jury, Ralph B. Kirscher, and Robert J. Faris, Bankruptcy Judges. Opinion by Judge Jury.
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