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Can a chapter 13 bankruptcy case be reopened by debtor for nonpayment of plan payments pursuant to section 350(b)?

Fresno, CA |

I was told the answer is yes only if the case was closed as opposed to dismissed for nonpayment. The case has been dismissed for less than one month and a final trustee report has not been completed.

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Attorney answers 5

Posted

If the trustee hasn't file the final report, I doubt that the case has been closed. What you are really looking for is a motion to set aside the dismissal. It is completely within the judge's discretion, but you didn't say why the case was dismissed and that would be important know if you want an idea of the likelihood of the judge vacating the dismissal.

First, the firm is a debt relief agency according to the U.S. Bankruptcy Code. We help people file for bankruptcy. We also do other stuff and we do it well, but Congress wants me to post this notice. Second, nothing on this site is legal advice. You are not my client unless you enter into a written agreement signed by you and me.

Asker

Posted

The case was dismissed pursuant to LBR 3015-1(g) for failure to make plan payments.

Carl H Starrett II

Carl H Starrett II

Posted

Why weren't you making the plan payments? Did you opposed the motion to dismiss? Have your circumstances changed? Did you have a Chapter 13 attorney?

Asker

Posted

Long story..but my income had been significantly reduced and I did not oppose the motion based on not getting noticed in time (not trustee's fault.) My income changed for the worse for a few months, putting about 1k behind in plan payments. I have additional income sources now that enable me to make up the deficiency and continue the current plan payments. I am pro per in my chapter 13. I am trying to see if I can simply reopen or get the order for dismissal set aside or if I have to refile a new petition.

Asker

Posted

An entry for dismissal has been filed in my case as of 10 days ago.

Carl H Starrett II

Carl H Starrett II

Posted

As I said before, the case is probably not closed. You can try to file a motion to vacate the dismissal.

Brian Crozier Whitaker

Brian Crozier Whitaker

Posted

Why would you want to reopen a failed Ch13 anyway? You may have to try to catch up on payments and/or file a modification to your Plan. Just file another ... it'll probably cost less than trying to revive a dead one.

Asker

Posted

I receive student grants and financial aid. Does this need to be reported as income in computing my net disposal income?

Asker

Posted

After my research, I agree with you, it is probably better to refile.

Brian Crozier Whitaker

Brian Crozier Whitaker

Posted

They would need to be included in your B22 (calculation of your six month average) but may be excluded from your Schedule I depending on their nature and duration. Do they put you over the median?

Asker

Posted

No, they do not. Lastly, my concern is for my vehicle and the automatic stay. I will need to file a motion to extend the stay as I would fall under the umbrella of having filed 2 chapter 13 petitions within 1 year. I would only have the "stay" for 30 days. This would not be enough time to get my plan confirmed. I would need to file a motion to extend the "stay" correct?

Brian Crozier Whitaker

Brian Crozier Whitaker

Posted

Yes ... and do it quickly.

Posted

In addition to what Mr. Starrett has offered, let me suggest that your case for setting aside a dismissal based on non-payment will require some showing of changed circumstances that now makes payment possible. The law generally favors Plan completion, and judges are typically full of good will for the Debtor who persists through adversity, but not one who has failed to pay through laziness, disregard for court orders or any other manner of bad faith. It goes without saying, of course, that representation by capable bankruptcy counsel will strengthen your case even more.

Best wishes for a favorable outcome, and please remember to designate a best answer.

This answer is offered as a public service for general information only and may not be relied upon as legal advice.

Posted

I agree more information is needed. The case will never just be "closed". There will be a dismissal first, then an order closing the case after the Trustee files the final report. Whether or not you will be able to reopen depends on the facts surrounding the dismissal, and the discretion of the Judge.

Posted

Consider
1. Send payment to Trustee
2. File motion to reinstate,

Posted

In So. District Texas, it would be took late. Check with a local lawyer asap. You might have to file a new case, with all of its requirements.

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