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.
BAP Narrowly Reads Section 506(d) on Voiding Liens Following Claim Disallowance
A debtor may employ Section 506(d) to avoid a lien only if disallowance of the associated secured claim was based on the.....