The relief described hereinbelow is SO ORDERED.

Signed May 09, 2007.

United States Bankruptcy Judge

____________________________________________________________

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF KANSAS

In re:

In re:

In re:

In re:

MEMORANDUM OPINION AN ORDER CONFIRMING CHAPTER 13 PLANS

07.05.09 Kinsey Memorandum Opinion.wpd

Confirmation of the above Debtors' respective Chapter 13 plans is pending before the

Court.1 At the Debtors' confirmation hearings, the Court confirmed the Debtors' Chapter 13

plans over the objections of the Creditors2 based upon this Court's prior decision in In re

Wampler. This Memorandum Opinion is in accord with Wampler, confirms the plans, and

constitutes the Court's findings and conclusions.

Factual Background

The Creditors loaned their respective Debtors money to purchase automobiles for

Debtors' personal use within the 910 days preceding the filing of the above-captioned

proceedings. The automobiles served as collateral for the loans. As a result, the Creditors assert

that 11 U.S.C. § 1325(a)3 requires their allowed claims be paid in full at the contract rate of

interest over the duration of the Debtors' Chapter 13 plans. Under the Debtors' plans as

confirmed, the Creditors' allowed claims are paid in full without postpetition interest. The

specific facts for each case are as follows.

Kinsey

WFAF's proof of claim indicates its collateral is a 2005 Mitsubishi Lancer, with a

balance due of $15,969.85, but the claim does not state the value of the vehicle. The Debtor

values the vehicle at $15, 986.68. The contract interest rate is 19.4%.

1 The same attorney, Jill D. Olsen, represents the various creditors objecting to the above Debtors' plans based upon treatment of 910 car claims. Ms. Olsen previously represented the creditor in this Court's ruling in In re Wampler, 345 B.R. 730 (Bankr. D. Kan. 2006), appeal dismissed per stipulation, No. 06-3275 (10th Cir. October 30, 2006). The Wampler appeal became moot after the debtors amended their plan to surrender the 910 car. In order to insure a 910 car case remains viable through the appellate process, the Court has grouped the above cases together based upon the similarity of the facts, the commonality of the objections, and the creditors' intent to pursue an appeal of the Wampler decision.

2 Creditors collectively refers to Wells Fargo Auto Finance (WFAF) and Wells Fargo Financial (WFF), the objecting creditors.

3 These cases were filed after October 17, 2005, when most provisions of the Bankruptcy Abuse

Prevention and Consumer Protection Act of 2005 became effective. All statutory references to the Bankruptcy Code are to 11 U.S.C. §§ 101-1330 (2006), unless otherwise specified.

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Walters

WFF's proof of claim indicates its collateral is a 1999 Chevrolet Blazer, with a balance

due of $7,767.41. WFF's proof of claim also indicates the balance due is the value of the

vehicle. The Debtors value the vehicle at $7,200.00. The contract interest rate is 19.99%.

Thompson

WFF's proof of claim indicates its collateral is a 2002 Suzuki XL-7, with a balance due

of $11,762.29. WFF's proof of claim also indicates the balance due is the value of the vehicle.

The Debtor values the vehicle at $7,000.00. The contract interest rate is 18.74%.

Prince

WFAF's proof of claim indicates its collateral is a 2004 GMC C1500 Sierra, with a

balance due of $28,638.82, but the proof of claim does not reflect the value of the vehicle.

Debtors value the vehicle at $18,350.00. The contract interest rate is 7.84%.

Discussion

1.      The Hanging Paragraph Removes 910 Car Claims from the Ambit of 11 U.S.C. § 1325(a)(5)

   Before and after Wampler, most courts have interpreted the Hanging Paragraph4 to mean

merely that the debtor is prohibited from bifurcating a creditor's claim and cramming down the

value of the secured claim to the collateral's value leaving an unsecured claim for any

deficiency.5 However, the Hanging Paragraph does not state it only prohibits the bifurcation of

4 The Hanging Paragraph of § 1325(a) reads: For purposes of paragraph (5), section 506 shall not apply to a claim described in that paragraph if the creditor has a purchase money security interest securing the debt that is the subject of the claim, the debt was incurred within the 910-day preceding the date of the filing of the petition, and the collateral for that debt consists of a motor vehicle (as defined in section 30102 of title 49) acquired for the personal use of the debtor, or if collateral for that debt consists of any other thing of value, if the debt was incurred during the 1-year period preceding that filing. The provision is an unnumbered paragraph at the end of the subsection; thus, it has become commonly referred to as the Hanging Paragraph.

5 In re DeSardi, 340 B.R. 790, 812 (Bankr. S.D. Tex. 2006) ([A 910 Language] claim is an allowed

secured claim and may be treated under § 1325(a)(5).); In re Fleming, 339 B.R. 716, 722 (Bankr. E.D. Mo. 2006) (The [910 Language] Language merely prohibits the bifurcation and cram down of the Car Creditors' claims and

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certain claims, even though such limitation and effect could have been easily and succinctly

drafted. The Hanging Paragraph is more broadly written, acknowledges a specific class of

claims, and alters their treatment. Other courts have found that despite the Hanging Paragraph's

clear language stating § 506 does not apply to § 1325(a)(5), 910 car claimants nonetheless have

an allowed secured claim for purposes of preserving the present value of the entire claim under

§ 1325(a)(5)(B)(ii). In attempting to explain this conclusion, those courts have taken a snippet

from Dewsnup v. Timm6 and linked § 5027 and § 101(37)8 to create a new definition of allowed

secured claim for § 1325(a)(5). The snippet from Dewsnup which has been incongruously

interpreted into § 1325(a)(5) says that the phrase allowed secured claim is not a term of art and

should be read separately word by word to mean any claim that is first fully allowed and then

also secured by a lien.9 By reading each term separately, these courts reason that although § 506

is no longer applicable, a creditor whose claim falls under the Hanging Paragraph may still have

an allowed claim under § 502 which is secured by a lien as defined by § 101(37). Thus, courts

have allowed creditors present value interest on their entire claim amount rather than just the

thus quantifies the Car Creditors' secured claims at the balance due on the filing date.); In re Brown, 339 B.R. 818, 820 (Bankr. S.D. Ga. 2006) ([T]he [910 Language] means only that the claims it describes cannot be bifurcated into secured and unsecured portions under § 506(a).); In re Ezell, 338 B.R. 330, 340 (Bankr. E.D. Tenn. 2006) ([W]hen the creditor files its claim as secured, the [910 Language following § 1325(a)(9)] precludes the use of Revised § 506(a) to reduce or bifurcate that claim into secured and unsecured components.); In re Wright, 338 B.R. 917, 919-20 (Bankr. M.D. Ala. 2006) ([T]he claims of these creditors [affected by the application of the 910 Language following § 1325(a)(9)] must be treated as fully secured under the plan.); In re Robinson, 338 B.R. 70, 73-74 (Bankr. W.D. Mo. 2006) ( [T]hese creditors are entitled to secured claims for the total amount of their claims, regardless of the value of the respective vehicles, and the Debtor cannot bifurcate them.); In re Johnson, 337 B.R. 269, 272 (Bankr. M.D.N.C. 2006) (The [910 Language following § 1325(a)(9)] simply provides that debtors may not bifurcate the claims of lenders with purchase money security interests in vehicles purchased within 910 days of bankruptcy for the debtor's personal use.); see also In re Horn, 338 B.R. 110 (Bankr. M.D. Ala. 2006).

6 502 U.S. 410 (1992). Dewsnup is a Chapter 7 case in which the Supreme Court found allowed secured claim has a different meaning in § 506(d) than in § 506(a) so that Chapter 7 debtors may not strip down a creditor's lien on real property to the value of the collateral.

7 11 U.S.C. § 502 provides the procedure for claim allowance.

8 The term 'lien' means charge against or interest in property to secure payment of a debt or performance

of an obligation. 11 U.S.C. § 101(37).

9 See, e.g., Brown, 339 B.R. at 821 (citing Dewsnup, 502 U.S. at 415). Brown concludes that the Supreme Court's term-by-term interpretation of the phrase allowed secured claim in Dewsnup is equally applicable to the phrase allowed secured claim in § 1325(a)(5).

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value of their collateral.

This conclusion is at odds with the plain meaning of § 1325(a)(5). When analyzing the

phrase allowed secured claim specifically in the context of § 1325(a)(5), the Supreme Court

found the phrase means the value of the collateral as determined under § 506(a).10 Nowhere does

the Code say a creditor may have an allowed secured claim under § 1325(a)(5) without

§ 506(a). The very essence of § 1325(a)(5) is to preserve the value of the collateral, not the

value of the entire claim.11 The Supreme Court has stated, The value of the allowed secured

claim is governed by § 506(a) of the Code.12 In another case, the Supreme Court stated § 506

governs the definition and treatment of secured claims, i.e., claims by creditors against the

estate that are secured by a lien on property in which the estate has an interest.13 Further, the

Supreme Court has found that § 506 defines the amount of the secured creditor's allowed

secured claim and the conditions of his receiving postpetition interest.14 One year after

Dewsnup said allowed secured claim in §506(d) need not be read as an indivisible term of art

defined by reference to §506(a), the Supreme Court referred to secured claim as a term of art

defined by §506(a) for the purposes of distinguishing between a secured claim and a claim

secured by a lien in the context of §1322(b)(2).15 To say that § 506(a) does not determine

allowed secured claim in § 1325(a)(5) ignores the Supreme Court cases holding to the

contrary,16 and, as pointed out in Wampler, opens the present value interest requirement to many

10 Associates Commercial Corp. v. Rash, 520 U.S. 953, 957 (1997).

11 In re Paschen, 296 F.3d 1203, 1206 (11th Cir. 2002).

12 Rash, 520 U.S. at 957.

13 United States v. Ron Pair Enters., Inc., 489 U.S. 235, 238-39 (1989).

14 United Sav. Ass'n of Texas v. Timbers of Inwood Forest Assocs., 484 U.S. 365, 371 (1988).

15 Nobelman v. American Sav. Bank, 508 U.S. 324, 331 (1993).

16 Ron Pair Enters., Inc., 489 U.S. at 239; Till v. SCS Credit Corp., 541 U.S. 465, 470 (2004) (defining

creditor's secured claim under § 506(a) for purposes of § 1325(a)(5)); Rash, 520 U.S. at 957 (the value of the allowed secured claim under § 1325(a)(5)(B)(ii) is governed by § 506(a)); Nobelman, 508 U.S. at 331.

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claims, which was clearly not the intent of Congress.17 An allowed secured claim in

§ 1325(a)(5) is the present value of the collateral.18 Section 1325(a)(5) concerns itself with

preserving the value of the collateral, not the entire claim.

Section 1325(a)(5) makes the sole reference to treatment of allowed secured claims for

plan confirmation. However, as to 910 car claims under the Hanging Paragraph, § 506 does not

apply for the purposes of subparagraph (5). Because § 506 does not apply to 910 car claimants

and because the only means by which creditors are entitled to an allowed secured claim is

determined under § 506, those creditors cannot hold allowed secured claims and are not entitled

to treatment under § 1325(a)(5). As noted in Wampler, this conclusion is supported by the

frequently cited and well-regarded bankruptcy treatise Collier on Bankruptcy and is worth

repeating here:

Language added at the end of section 1325(a) by the 2005 amendments to the Bankruptcy Code removes certain claims from the protections of section 1325(a)(5). This new language states that for purposes of section 1325(a)(5), section 506 shall not apply to certain claims. Such claims, therefore, cannot be determined to be allowed secured claims under section 506(a) and are not within the ambit of section 1325(a)(5). Such claims may still be modified under section 1322(b)(2), which allows modification of the rights of holders of secured claims, with certain exceptions, but the restrictions on modification that apply to allowed secured claims under section 1325(a)(5) do not apply. A debtor is presumably bound only by the dictates of good faith and the other provisions of the Code in determining how such claims may be modified. Some courts, understandably, may look to prior law for guidance regarding what modifications are equitable.19

This Court agrees with Collier on Bankruptcy, which goes on to state:

It is possible that this language [the Hanging Paragraph] was intended to prohibit the use of section 506(a) to bifurcate a secured claim into an allowed secured

17 Wampler, 345 B.R. at 739.

18 Rash, 520 U.S. at 957 (under § 1325(a)(5)(B)(ii) the debtor is required to provide the creditor with

payments, over the life of the plan, that will total the present value of the allowed secured claim, i.e., the present value of the collateral . . . .).

19 8COLLIER ON BANKRUPTCY¶1325.06[1][a] at 1325-28 (Alan N. Resnick & Henry J. Sommer, eds., 15th ed. rev. 2006).

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claim and an allowed unsecured claim as part of the cramdown permitted by section 1325(a)(5)(B) and, therefore, that such claims should be treated as fully secured claims regardless of the value of the collateral. But, even if that was the intent, because the new language added to section 1325(a) renders entirely inapplicable for some creditors the only section, section 506(a), that gives those creditors allowed secured claims, it does not to carry out such intent. In fact, earlier versions of the 2005 bankruptcy legislation had contained language which eliminated only the section 506(a) bifurcation of certain claims into secured and unsecured claims based on the value of the property, but did not eliminate their status as allowed secured claims. However, that language was not retained.

Courts are required to implement the language of the statute and not what they think Congress might have intended instead.20

The statutory construction explained by Collier and adopted by this Court is most in

concert with the plain reading of the amendment and, hence, in conformity with the interpretive

dictate of the Supreme Court that when the statute's language is plain, the sole function of the

courts - at least where the disposition required by the text is not absurd - is to enforce it

according to its terms.21

The Hanging Paragraph prohibits the use of § 506 to determine the value of the collateral.

If the value of the claim, i.e., the value of the collateral, cannot be calculated, then it follows that

the allowed amount of the secured claim referenced in § 1325(a)(5)(B)(ii)22 cannot be preserved.

The Code generally does not allow interest on entire claim amounts.23 Unsecured and

undersecured creditors generally are not allowed postpetition interest on unsecured claims, and

oversecured creditors are only entitled to interest if it comes from the collateral's equity

20 8 COLLIER ON BANKRUPTCY¶1325.06[1][a] at 1325-28 to 1325-29 (Alan N. Resnick & Henry J. Sommer, eds., 15th ed. rev. 2006) (citations omitted).

21 Lamie v. United States Trustee, 540 U.S. 526, 534 (2004) (quoting Hartford Underwriters Ins. Co. v. Union Planters Bank, N.A., 530 U.S. 1, 6 (2000) (internal quotation marks omitted) (quoting United States v. Ron Pair Enterprises, Inc., 489 U.S. 235, 241 (1989) (in turn quoting Caminetti v. United States, 242 U.S. 470, 485 (1917)))).22

(a) Except as provided in subsection (b), the court shall confirm a plan if – (5) with respect to each

allowed secured claim provided for by the plan – (B)(ii) the value, as of the effective date of the plan, of property to be distributed under the plan on account of such claim is not less than the allowed amount of such claim . . . . (Emphasis added).

23 11 U.S.C. § 502(b)(2); In re Milham, 141 F.3d 420, 423 (2nd Cir. 1998).

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cushion.24 This notion recognizes the pre-Code rule that it is unfair to award secured creditors

interest from the estate's unencumbered assets before unsecured creditors receive any principal.25

Plan interest on secured claims in Chapter 13 is solely a function of the present value

requirement of the cramdown provision. Section 1325(a)(5)(B)(ii) is intended to put the creditor

in the same economic position it would have been in had it received the value of its collateral

immediately. Section 1325(a)(5)(B)(ii) is not intended to put the creditor in the same position it

would have been in had it renewed a loan. The Code protects the creditor's interest in property,

not profit. Accordingly, if the creditor is not crammed down, he is not eligible for the protection

found in § 1325(a)(5)(B)(ii). The 910 creditor's interest is already preserved in another manner

– its claim is not reduced to the present value of the collateral.

The lynchpin in the majority's analysis is Dewsnup, but Dewsnup is easily distinguished

in that it was limited to a Chapter 7 proceeding wherein the debtor attempted to employ § 506(d)

to strip down a mortgagee's lien on real property.26 The Supreme Court expressed no opinion

as to whether the words 'allowed secured claim' have a different meaning in other provisions of

the

 Bankruptcy Code27 and did not consider § 1325(a)(5). Ironically, the majority position seizes

upon Dewsnup's definition of allowed secured claim from § 506(d), which is also inapplicable

to a Hanging Paragraph claim. Further, the Supreme Court was still working within the

framework of the only statute which gives creditors allowed secured claims. Whereas Dewsnup

endeavored to provide two different definitions for the words allowed secured claim as found

24 11 U.S.C. § 506(b); Milham, 141 F.3d at 423 (§ 506(b) being the exception to the rule and allowing post-petition interest for oversecured creditors, but only to the extent of their security cushion and only until the confirmation date).

25 Timbers of Inwood Forest, 484 U.S. at 373.

26 Dewsnup, 502 U.S. at 410-12.

27 Dewsnup, 502 U.S. at 417 n.3.

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in two different subsections of §506, the majority now relies on Dewsnup to provide two

different definitions for the exact same words found in the exact same place in § 1325(a)(5).

This Court will not string together the definition of lien with the Code section governing claim

allowance (§ 502) to conclude that a 910 car claim must be an allowed secured claim to be paid

interest under § 1325(a)(5)(B)(ii). The mere definition of lien found in § 101(37) does not

contemplate the manner in which a secured claim is treated under a Chapter 13 plan as §506

does. An allowed claim with a lien does not refer to the value of the charge against or interest

in the collateral. A creditor with a lien in a 910 car has the same legal right or interest in the

vehicle whether the vehicle is worth $10,000 or scrap value. The allowance of the entire debt as

the claim does not quantify the security as § 1325(a)(5)(B)(ii) requires. Thus, two definitions for

the same phrase in the same statute does not make sense. Section 506 defines allowed secured

claim and sets a value to determine its treatment - a value which is crucial to the correct

operation of § 1325(a)(5)(B)(ii). Again, if the Hanging Paragraph prohibits the statutory tool to

determine a value, § 1325(a)(5) cannot be applied because § 1325(a)(5) is concerned with

preserving cramdown values, not entire claim amounts.

Section 506 provides the only mechanism in the Code to determine the treatment of an

allowed secured claim. State law may define and create property interests, but it is the function

of the Code to determine claim treatment in bankruptcy. After all, a creditor may have a lien

without holding an allowed secured claim.28 By removing § 506 from the equation, claims

falling under the Hanging Paragraph are a new class of claims secured by a non-bankruptcy lien,

allowed under § 502, and treated outside the confines of § 1325(a)(5). The existence of the lien

requires payment of the full claim amount during the pendency of the plan. Far from being

28 Matter of Tarnow, 749 F.2d 464, 465 (7th Cir. 1984).

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deprived of their prepetition liens, creditors holding liens in property subject to the Hanging

Paragraph will retain the lien until payment of their allowed claims. The Hanging Paragraph

does not alter the creditor's prepetition lien, but provides for separate and distinct treatment of

the allowed claim. As allowed, but not secured under the Code, 910 car claims may not include

unmatured or, in this case, postpetition interest.29

Since the Hanging Paragraph does not allow payment as an allowed secured claim of

present value interest on these 910 car claims, the Debtors in the cases at bar provide for

appropriate treatment because their plans provide for retention of the collateral and payment in

full of the Creditors' claims over the length of the plan without postpetition interest. Lenders

enjoy special treatment for their 910 car claims in Chapter 13 because of the Hanging

Paragraph, but these claims are no longer treated as allowed secured claims under the plan and

are not entitled to postpetition interest under § 1325(a)(5)(B)(ii).

Another approach has been adopted by at least one court.30 That court found that § 506 is

definitional and that simply because a claimant holds a claim, secured by a valid state law lien,

does not make the claim an 'allowed secured claim' for Bankruptcy Code purposes. With all due

respect to my colleagues, this Court rejects the reasoning of this line of cases. . . . But, if § 506 is

made inapplicable to the claim by the hanging paragraph, it may in fact be a claim secured by a

lien but not qualify for treatment as an 'allowed secured claim' under the Bankruptcy Code.31

The court went on to conclude,

[T]he exclusion of § 506 [because of the Hanging Paragraph] is simply, and only, for purpose [sic] of determining if the plan, as proposed, satisfies the requirements of § 1325(a)(5) as to the claim. In other words, the effect of § 506's exclusion is not complete but serves to eliminate only those provisions that might

29 § 502(b)(2).

30 In re White, 352 B.R. 633, 643 (Bankr. E.D. La. 2006).

31 Id.

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affect confirmation and the required treatment of the creditor's claim. Thus, it is designed to disassociate both the rights granted and limitations imposed by § 506 on secured claims vis a vis the confirmation process in chapter 13. What follows from this reasoning is that a qualifying purchase money security interest claim is not limited to the value of the collateral securing the debt; nor is it allowed post petition interest or other charges which may accrue on the claim, regardless of the existence of equity. Instead, the treatment of the purchase money security interest claim [910 claim] is entirely dependent upon the rights provided in § 1325(a)(5).32

In a unique interpretation, the White court concluded that the 910 claimant is entitled to

postpetition interest because § 1325(a)(5)(B)(ii) requires that the value, as of the effective date

of the plan, of property to be distributed under the plan on account of such claim is not less than

the allowed amount of such claim . . . .33 Since a 910 claim may not be stripped down to

collateral value or, perhaps in more common parlance, bifurcated, the 910 claim as of the

petition date may not be reduced. Under the White court's approach, the 910 claimant received

the present value of its claim by virtue of § 1325(a)(5)(B)(ii). Hence, the 910 claimant was

entitled to a stream of payments equal to the present value of its claim (i.e., postpetition

interest).34 The court concluded that the creditor is entitled to the present value of its claim

based on a Till formula rate.35 At the end of the day, while finding that the 910 claimant does

not hold an allowed secured claim, the White court required payment in full of the 910 claim

with postpetition interest.

Although the White court's attempt to integrate the relevant Code provisions is more

convincing than that of the majority, this Court is not persuaded to change its initial holding as

set out in Wampler. Throughout § 1325(a)(5), the term claim is used, but it is a defined term

and qualified at the onset of § 1325(a)(5), which states with respect to each allowed secured

claim provided for by the plan. The subsequent references to the term claim in § 1325(a)(5)

are, by definition, references to an allowed secured claim, a classification that the Hanging

Paragraph eviscerates with regard to 910 claims. Ultimately, the White court employed an

analysis regarding the treatment of 910 claims under § 1325(a)(5) that of necessity is tied to the

term allowed secured claim. If, as the White court suggests, a 910 claimant does not hold an

allowed secured claim, then of necessity all subsequent references to claim in the subtext may

not apply to the treatment of a 910 claim since subsection 1325(a)(5) interchangeably uses

claim and allowed secured claim.

It is generally understood that to provide for the present value of a claim, it is necessary

for the debtor to pay interest on the claim in consideration of the deferred payments.36 For

instance, the liquidation test (best-interest-of-creditors test) under § 1325(a)(4) requires that the

debtor pay the present value to unsecured creditors of what they would receive in a hypothetical

Chapter 7 liquidation. However, under the § 1325(a)(4) present value requirement, the

unsecured creditors are not necessarily entitled to the Till rate of interest, but are entitled to a rate

of interest comparable to that which would have been received if the unsecured claim were

immediately paid to a holder and invested.37 This interest rate should be lower than the Till rate

since the issues regarding value of collateral and adequate protection are not applicable. An

investment rate of interest more properly effects the directive of the statute.38 If this Court were

to adopt the White court's analysis, then it would be more inclined to adopt the present value

interest rate established under § 1325(a)(4) since it is the present value of the 910 creditor's debt

36 Till v. SCS Credit Corp., 541 U.S. 465 (2004). However, at least one court has questioned whether the Till plurality decision is binding precedent. See In re Cook, 322 B.R. 336, 341 (Bankr. N.D. Ohio 2005).

37 See In re Plascencia, 354 B.R. 774, 782 (Bankr. E.D. Va. 2006).

38 However, there is not a consensus as to the calculation of the present value interest rate under

§ 1325(a)(4). See, e.g., In re Cook, 332 B.R. 336, wherein the court calculated the interest rate as that for short term, oversecured loans.

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that is paid. If a 910 claimant does not hold an allowed secured claim, then payment of the Till

rate of interest is less compelling.39

2.     The Criteria Set Forth in § 1325(a) Are Not the Exclusive Grounds for Confirming a Chapter 13 Plan Over a Creditor's Objection.

   Even if the criteria set forth in § 1325(a) otherwise entitles the Creditors to allowed

secured claims with interest accruing thereon, this Court retains the discretion to confirm

Chapter 13 plans over a creditor's objection.40 As noted by the Third Circuit in In re Szostek,

[i]f Congress had intended for § 1325(a) to be mandatory, it could have included that

requirement with the requirements already listed in § 1322.41 Further evidence of the

discretionary nature of § 1325(a) is found by comparison with the language of § 1129(a), which

provides that a court shall confirm a Chapter 11 plan only if certain requirements are met.42

Thus, the distinction between § 1322 and § 1325(a) and the inclusion of the only if language in § 1129, which is absent from § 1325(a), show an unmistakable intent on the part of Congress that a plan may be confirmed even if it does not comport with the requirements of § 1325(a)(5).43

Here, the Court would have confirmed the Debtors' Chapter 13 plans regardless of

whether § 1325 requires the Creditors' claims be paid with postpetition interest, either at contract

or some other rate, over the duration of the Debtors' Chapter 13 plans. The Court believes the

Debtors' plans were filed in good faith. Because the Debtors propose to pay the Creditors'

allowed claims over the duration of the plan, the Creditors could very well receive more than

they would have received had the Debtors filed under Chapter 7 or otherwise surrendered the

collateral to the Creditors, or if the liens were stripped down in a Chapter 13 before BAPCPA.

39 See In re Cook, 322 B.R. 336, 341 (Bankr. N.D. Ohio 2005).

40 Matter of Escobedo, 28 F.3d 34, 35 (7th Cir. 1994); In re Szostek, 886 F.2d 1405, 1411 (3rd Cir. 1989). 
41 886 F.2d at 1411. Notably, the Tenth Circuit has cited Szostek as supporting authority for its decisions,

although in relation to different legal issues, on at least two other occasions. See In re Andersen, 179 F.3d 1253 (10th Cir. 1999); In re Talbot, 124 F.3d 1201 (10th Cir. 1997).

42 11 U.S.C. § 1129(a).

43 Szostek, 886 F.2d at 1411.

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The Creditors do not contest that the Debtors' plans satisfy the required elements of

§ 1322(a). Accordingly, it is within the province of this Court to determine whether the

remaining terms of the Debtors' Chapter 13 plans provide appropriate and equitable treatment of

the Creditors' claims. The Court finds that the facts and circumstances of these proceedings

warrant the conclusion that the Debtors' plans should be confirmed notwithstanding any alleged

failure to satisfy criteria found in § 1325(a)(5).

###

ROBERT D. BERGER

U.S. BANKRUPTCY JUDGE

DISTRICT OF KANSAS

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