Case Number 1-17-13506-bhl
The chapter 13 trustee objected to confirmation of the debtor's plan on several grounds, including the debtor's ineligibility to be a chapter 13 debtor because she exceeded the debt limits established by section 109(e). The debtor had scheduled over $870,000 in noncontingent, liquidated, unsecured debt, of which approximately $700,000 was attributable to student loan obligations. The debtor argued it would be in the best interests of the creditors to allow her to remain in chapter 13, and urged the court to exclude her student loan debts from the total unsecured debt limits of section 109(e). The court rejected the debtor's arguments, finding the plain terms of section 109(e) precluded a person who was ineligible to be a chapter 13 debtor from continuing in a chapter 13 case. Because the debtor would not be able to cure her ineligibility to be a chapter 13 debtor, she would never be able to propose a plan that complied with Title 11 or section 1325(a)(1). The court therefore denied confirmation of the plan and stayed dismissal of the case in order to afford the debtor an opportunity to convert to chapter 7 or chapter 11.