PARKER, Circuit Judge:
Section 707(b) of the Bankruptcy Code allows a bankruptcy court to dismiss a petition filed under Chapter 7 if it determines that relief would be an "abuse" within the meaning of that section. 11 U.S.C. § 707(b). In this appeal from a judgment
In March 2011, Stratton Pollitzer filed for bankruptcy relief under Chapter 13 of the Code. Under Chapter 13, a debtor such as Pollitzer who aims to restructure his debts may retain his assets but must submit a plan to repay his debts over a three- to five-year period. The payments are generally made from the debtor's future earnings or income. See Harris v. Viegelahn, ___ U.S. ___, 135 S.Ct. 1829, 1835, 191 L.Ed.2d 783 (2015). Pollitzer submitted a Chapter 13 repayment plan and made the required payments for more than two years but then exercised his right under § 1307 of the Code to convert his case to Chapter 7. 11 U.S.C. § 1307.
In contrast to Chapter 13, Chapter 7 requires a debtor to transfer nearly all of his prepetition assets to the bankruptcy court for distribution to creditors, but allows the debtor to shield from creditors postpetition income and assets. In sum, unlike Chapter 13 claimants, individuals who file under Chapter 7 liquidate their nonexempt assets rather than dedicate their future income to repay creditors. See Ransom v. FIA Card Servs., N.A., 562 U.S. 61, 65 n.1, 131 S.Ct. 716, 178 L.Ed.2d 603 (2011). Consequently, while a Chapter 7 debtor must forfeit virtually all his prepetition property, he is able to make a "fresh start" by shielding his postpetition earnings from creditors. Harris, 135 S.Ct. at 1835. An important distinction between Chapters 7 and 13 is that Chapter 7 was not designed for debtors with repayment ability: i.e., those with sufficient income to repay their debts over time.
Congress believed that debtors who could make such payments were abusing the Code by filing under Chapter 7 which extinguished debts they could otherwise pay from postpetition income. To help insure this did not occur, Congress passed § 707(b) specifically to emphasize the responsibility of courts to dismiss Chapter 7 cases filed by debtors with repayment ability.
Section 707(b)(1) provides that:
11 U.S.C. § 707(b)(1). To determine whether relief would be an abuse of Chapter 7, the statute creates a means-test codified at 11 U.S.C. § 707(b)(2)(A)(i). The means-test, if met, requires the court to presume the petition to be abusive.
After Pollitzer converted his petition, the U.S. Trustee moved to dismiss it as abusive under § 707(b). The Trustee contended that Pollitzer's disposable income, which far exceeded the means-test, would allow for a significant dividend to unsecured creditors. Pollitzer opposed the motion on the sole ground that § 707(b) does not apply to petitions initially filed under Chapter 13 and later converted to Chapter 7. Pollitzer concedes that his petition fails to satisfy the means-test and that his petition would be subject to dismissal as an abusive petition if § 707(b) applied.
Pollitzer's argument is textual. He points to the language of § 707(b) limiting it to "a case filed by an individual debtor under this chapter" and reads the phrase "under this chapter" as modifying the phrase "a case filed." Because, he argues, his was not a "case filed ... under this chapter [Chapter 7]," but rather was filed under Chapter 13, § 707(b) does not apply. The U.S. Trustee also makes a textual argument. He contends that "under this chapter" modifies the phrase to which it is immediately adjacent, "an individual debtor." And, the argument goes, because Pollitzer is an "individual debtor under [Chapter 7]," § 707(b) applies.
From the standpoint of text and grammar, both parties' readings of § 707(b) are defensible. Nevertheless, we are required to avoid an interpretation of that provision that would lead to consequences that are inconsistent with the statutory scheme under review. See In re Welzel, 275 F.3d 1308, 1314 (11th Cir. 2001). Because there are unmistakable indications in the Code that Congress intended § 707(b) to apply to converted cases, we reject Pollitzer's arguments.
We begin with the "textual evolution of § 707." In re Witcher, 702 F.3d 619, 622 (11th Cir. 2012). Congress initially passed § 707(b) as part of the Bankruptcy Amendments and Federal Judgeship Act of 1984 ("the 1984 Act"). See In re Piazza, 719 F.3d 1253, 1269 (11th Cir. 2013). Although bankruptcy courts always had the option of dismissing petitions "for cause," the 1984 Act for the first time allowed courts specifically to dismiss Chapter 7 petitions if it found them "substantially abusive." 11 U.S.C. § 707(b) (1984). Congress added this provision because it believed that the bankruptcy courts were insufficiently invoking the "for cause" provision to dismiss petitions filed by a growing number of Chapter 7 debtors that had income sufficient to pay their creditors. In re Piazza, 719 F.3d at 1269. Specifically addressing this point, we concluded that Congress passed the "substantial abuse" provision "in response to ... judicial abdication of authority." Id. We reasoned that "although courts dismissed cases `for cause' under the original § 707 based on prepetition bad faith, they were not doing so as readily as Congress would have preferred in the context of consumer debts." Id. One commentator has noted that Congress's ultimate goal was clear: following widespread and documented abuses of Chapter 7 by consumer debtors with significant ability to repay their debts, Congress specifically intended § 707(b) to be a "limitation of access to chapter 7 by debtors with a substantial debt repayment capacity." Irving A. Breitowitz, New Developments in Consumer Bankruptcy: Chapter 7 Dismissal on the Basis of "Substantial Abuse", 59 Amer. Bankr. L. J. 327 (1985).
Nevertheless, two decades after passage of the 1984 Act, Congress was of the view that the "substantial abuse" provision did not go far enough in limiting
Id.
This history and statutory evolution demonstrates that Congress intended the current version of § 707(b) to be a potent tool for bankruptcy courts to expeditiously dismiss Chapter 7 petitions filed by debtors with income sufficient to pay their creditors. This goal would be eviscerated were we to adopt Pollitzer's interpretation under which a debtor could file a Chapter 13 petition and, the following day, convert it to a Chapter 7 petition and thereby avoid the abuse review Congress incorporated into § 707(b).
Pollitzer offers nothing that convinces us that the removal of converted cases from the review for abuse of § 707(b) is a sound or reasonable application of the Code. His sole response is that removal of converted cases from § 707(b) is not problematic because there are other ways to deal with bad-faith debtors, such as 11 U.S.C. § 105(a). See In re Layton, 480 B.R. 392, 397 (Bankr. M.D. Fla. 2012). That provision allows a court to dismiss a bankruptcy case "to prevent an abuse of process." 11 U.S.C. § 105(a). We are not convinced. As discussed, Congress passed § 707(b) precisely because the "for cause" basis for dismissal under the original § 707 did not work as readily as Congress would have preferred. And, BAPCPA was specifically directed at what Congress viewed as the bankruptcy courts' continued reluctance to dismiss petitions filed by debtors with repayment ability. Excluding converted cases from § 707(b) would, in effect, read this important remedial provision out of the Code, and we reject interpretations of the Code that would produce such absurd results. See In re Lehman, 205 F.3d 1255, 1255-56 (11th Cir. 2000); see also Durr v. Shinseki, 638 F.3d 1342, 1349 (11th Cir. 2011).
Moreover, when interpreting statutory provisions, we do not, as Pollitzer would have us do, review language in isolation. Rather, we consider the language, the specific context in which that language is used, and the broader context of the statute as a whole. Warshauer v. Solis, 577 F.3d 1330, 1335 (11th Cir. 2009). For several reasons, this approach reinforces our conclusion.
Second, Congress knew how to exclude certain categories of cases from provisions within § 707(b) but did not do so with converted cases. Specifically, certain petitions filed by disabled veterans or those recently released from active duty are expressly exempted from § 707(b)(2)'s means-test. See 11 U.S.C. § 707(2)(D). Given that Congress took care to craft specific exclusions for certain debtors from § 707(b)'s means-testing, we are loath to infer the wholesale exclusion of converted petitions. See Toibb v. Radloff, 501 U.S. 157, 160-161, 111 S.Ct. 2197, 115 L.Ed.2d 145 (1991).
Finally, we find it persuasive that when Congress passed BAPCPA, it left unaffected Federal Rule of Bankruptcy Procedure 1019(2)(A), which sets a new time period for filing a motion under § 707(b) in a case that has been converted from Chapter 13 to Chapter 7.
The judgment of the district court is AFFIRMED.