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IN RE FREDERICKSON
Monday, October 15, 2007
The Bankruptcy Appellate Panel for the 8th Circuit came out with a decision on 9/24/07 holding that the phrase "projected disposable income" contained in 1325(b) means the "disposable income" resulting from the means test(as defined by the statute) "projected" over the applicable commitment period. Some other decisions, in what appears to be goal-oriented jurisprudence, had held that the phrase "projected disposable income" had nothing to do with the definition of "disposable income" contained in the same subsection of the same statute. The court's decision also holds that a Chapter 13 plan need not have a duration of 36 or 60 months. Instead, once a debtor pays into the plan the "projected disposable income" calculated as of the time of filing, the plan is completed.
This BAP decision deals with a case originating from Arkansas. Therefore, it likely will not control cases filed in Missouri. However, it is certainly an indication of how the BAP will treat such issues in the future.