Joining the Tenth Circuit, the Ninth Circuit also has held that chapter 13 trustees are not paid their fees when cases are dismissed before confirmation. The identical issue was argued on February 15 before the Second Circuit.
In short order, we’ll have either unanimity or a split of circuits. A split will give rise to an issue worthy of a grant of certiorari by the Supreme Court.
Notably, the Ninth Circuit’s opinion on June 12 adopted reasoning in an amicus brief filed in support of the debtor by the National Consumer Bankruptcy Rights Center and National Association of Consumer Bankruptcy Attorneys.
Another bankrupt lost when trying to find a loophole that would allow discharging post-filing obligations arising in connection with a home that the debtor intended to abandon.
A third violation of fiduciary duties is enough in the Fifth Circuit to remove a trustee for cause under Section 324(b).