MANEY v. KAGENVEAMA
The Ninth Circuit Court of Appeals today released an opinion in MANEY v. KAGENVEAMA, No. 06-17038, a bankruptcy appeal. The panel consisted of Harry Pregerson, Eugene E. Siler, Jr., and Carlos T. Bea, Circuit Judges.
SILER, Circuit Judge: Edward Maney, as Chapter 13 Trustee, appeals the bankruptcy court’s order confirming the plan of the debtor, Laura Kagenveama. He argues that the bankruptcy court erred by (1) calculating Kagenveama’s “projected disposable income” by multiplying her “disposable income” over the “applicable commitment period” and (2) finding the five-year “applicable commitment period” inapplicable because Kagenveama’s resulting “projected disposable income” was a negative number. We affirm. I. Background In 2005, Kagenveama filed a petition for Chapter 13 protection in the bankruptcy court. In her filing she included the required Schedules A through J, a Statement of Financial Affairs, a Master Mailing List, and a Form B22C Statement of Current Monthly Income and Calculation of Commitment Period and Disposable Income. Schedules I and J listed Kagenveama’s projected monthly income and expenses. Her Schedule I listed a monthly gross income of $6,168.21, with a monthly net income of $4,096.26. Her Schedule J listed monthly expenses of $2,572.37. Subtracting total monthly expenses from total monthly net income left Kagenveama with $1,523.89 in monthly income available to pay creditors. Kagenveama filed an amended Form B22C listing an average monthly gross income of $6,168.21 for the six months prior to her bankruptcy petition, yielding an annual income of . . .
The opinion in Maney v. Kagenveama, filed June 5, 2008, is amended as follows: insert <In re Pak, 378 B.R. 257, 267 . . .
BEA, Circuit Judge, concurring in part and dissenting in part: This case deals with how long a Chapter 13, “wage-earner” debtor in bankruptcy proceedings will have to worry about whether his unpaid creditors can bring up any good changes in his fortunes, to get paid his debts to them. The majority lays down a rule: So long as the debtor can calculate no “disposable income” at the time his creditor plan is confirmed, he can rest easy. The debtor can propose as short a time period as he wants: a day, a week or a month. I dissent because Congress pretty clearly stated his creditors should have up to five years to keep an eye on the debtor to perhaps share in any of his new good times. Respectfully to the majority, I think the rule they adopt creates an incentive for the picaresque, by encouraging a debtor to fiddle with his expenses and income just before he presents his creditor plan for confirmation. So long as he can push up his expenses and delay receipt of income so as to show no “disposable income” at the time of plan confirmation, he can propose such a short period of time that he can save any postponed income from the creditors’ clutches. The majority’s result is not required by a close reading of the Bankruptcy Code; indeed, quite the opposite is the correct reading. For this reason, I partially dissent from the majority opinion. I concur in the majority opinion’s holding as to the calculation of “projected disposable income.” I agree projected disposable income in 11 U.S.C. § 1325(b)(1)(B) is calculated according to § 1325(b)(2)’s statutory definition of “disposable income”, using Form B22C–regardless the debtor’s actual disposable income on the date of plan confirmation–and then . . .