A. Bruce Campbell, United States Bankruptcy Judge
Before the Court is the
The Personal Representative continued making the plan payments. On January 27, 2014, almost three years later, after completing all payments under the Debtor's confirmed plan, the Personal Representative moved the Court to waive the requirement that the Debtor complete the course in personal financial management because the Debtor had died. Despite the fact that Debtor died in February, 2011, only one month after his plan was confirmed, the Court was never notified of Debtor's death, until after the Personal Representative had completed all payments and sought to obtain an order of discharge.
On April 1, 2014, this Court issued an Order Denying Motion to Waive Financial Management Court Requirement and Order Dismissing This Case ("Order"). The Order relied, in part, on Fed. R. Bankr. P. 1016 (Death or Incompetency of Debtor)
The Personal Representative argues that Fed. R. Bankr. P. 1016 permits exactly what she seeks. It permits a deceased debtor's case to proceed to discharge for the protection and benefit of her and her children's well being. She points to a portion of the legislative history of section 541 of the Bankruptcy Code as support for her argument that "a probate estate (as represented by the probate estate's Personal Representative) may receive and benefit from a bankruptcy discharge."
The House and Senate Reports for the enactment of section 541 of the Bankruptcy Code in 1978 discuss the repeal of Section 8 of the predecessor Bankruptcy Act.
The Personal Representative quotes the following:
The quote above, however, does not include the introductory sentences which provide some context for and view into the meaning of the sentences cited. Particularly they read:
Under the Bankruptcy Act of 1898, exempt property was not part of the bankruptcy estate and the bankruptcy court had limited jurisdiction over such property. Lockwood v. Exchange Bank of Fort Valley, 190 U.S. 294, 299, 23 S.Ct. 751, 753, 47 L.Ed. 1061 (1903). With the passage of the Bankruptcy Reform Act of 1978, and section 541 of the Code which defines what is "property of the estate," "all property of the debtor is included in the estate, including exempt property." Tignor v. Parkinson, 729 F.2d 977, 980 (4
The same legislative history of section 541 elaborates that property of the estate:
The legislative history which the Personal Representative relies upon speaks to the impact of the death of a debtor
In a Chapter 13 reorganization case, upon confirmation of a plan, the property of the estate revests in the debtor. 11 U.S.C. § 1327(b). The payment to creditors is funded, not by a trustee's liquidation of the debtor's non-exempt assets, but by debtor's payments from his or her future earnings.
The Personal Representative relies heavily on the language of Rule 1016 which provides that if a debtor in a reorganization case dies, "the case may be dismissed unless further administration is possible and in the best interest of the parties." The essence of the Personal Representative's arguments is that she is the "party" referred to in Rule 1016 whose interests should be served. This Court in its Order, and other courts, have concluded that she is not entitled to the benefit of a discharge in her deceased husband's case. In re Shepherd, 490 B.R. 338, 342-343 (Bankr. N.D.Ind.2013); In re Hennessy, 2013 WL 3939886 (Bankr N.D.Cal.2013); and In re White, 2011 WL 3426166 (S.D.Ga.2011).
This Court also observes that the Personal Representative did not inform the Court of the Debtor's death until after she had completed all payments under the plan. The time for the Court to have considered whether continued administration of the case was in the best interests of the parties should have been shortly after
Finally, the Personal Representative argues she has no adequate remedy at law. Whether that is the case at all, whether the laws governing her deceased husband's probate estate and its administration do or do not provide her "adequate" relief, and whether the filing of her own bankruptcy case would or would not provide adequate relief, are not considerations which compel this Court to set aside its dismissal order and enter an order of discharge in this case. Only a debtor who undertakes to file a bankruptcy case is entitled to the protections afforded by the Bankruptcy Code. See also, In re Shepherd, 490 B.R. 338, 342-343 (Bankr. N.D.Ind.2013); In re Hennessy, 2013 WL 3939886 (Bankr N.D.Cal.2013); and In re White, 2011 WL 3426166 2011 WL 3426166 (S.D.Ga.2011). Accordingly, it is
ORDERED that the Personal Representative's Motion to Reconsider is DENIED.