Messer v. Maney (In re Messer)

Citation:
BAP No. AZ-13-1215-PaKuD
Tag(s):
Ruling:
In an unpublished opinion, the United States Bankruptcy Appellate Panel of the Ninth Circuit affirmed the holding of the United States Bankruptcy Court for the District of Arizona, finding that: a) the value of an annuity for purposes of analysis under § 1325(a)(4) was the present day value of the entire annuity as of the confirmation hearing date; and b) the Bankruptcy Court correctly decided that the Debtor’s First Amended Chapter 13 Plan should be denied, because Debtor failed to show the First Amended Plan satisfied the§ 1325(a)(4) best interest of creditors test.
Procedural context:
Appeal from the United States Bankruptcy Court for the District of Arizona’s decision, which denied confirmation of the Debtor’s First Amended Chapter 13 Plan. The Bankruptcy Appellate Panel reviewed the Bankruptcy Court’s conclusions of law de novo, its factual determinations under the clearly erroneous standard, and its decision concerning confirmation of a Chapter 13 plan for abuse of discretion.
Facts:
Cynthia Messer (“Debtor”) filed a Chapter 7 petition on February 7, 2011 and converted her case to Chapter 13 seven months later. On schedule B she listed an annuity, valuing it at $2,000.00 and claimed it as fully exempt. The exemption was disallowed by the bankruptcy court. The bankruptcy court held an evidentiary hearing on the value of the annuity, ultimately accepting Debtor’s evidence regarding its value, but expressing skepticism about whether the method used to value the annuity met the requirements under § 1325(a) to confirm a plan. The Debtor’s First Amended Plan was denied because the payments were not sufficient to pay all creditor claims and administrative expenses in full. The court subsequently entered a stipulated order confirming a Second Amended Plan, which increased the total to be paid through the plan to pay all allowed claims in full. The Debtor appealed this confirmation order, claiming that the court erred when it refused to confirm her First Amended Plan.
Judge(s):
Honorable Judge Jim D. Pappas, Honorable Judge Frank L. Kurtz and Honorable Judge Randall L. Dunn

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