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In re Horsely (Case No. 04-00820) 5/16/2008

The Debtor filed an application for hardship discharge under 11 U.S.C. § 1328.  Under Section 1328(b), a chapter 13 debtor can obtain discharge after confirmation even though complete payments under the plan have not been made so long as three criteria are satisfied.  The debtors must show that (1) the failure to complete plan payments is due to circumstances for which the debtors cannot justly be held accountable; (2) the value of property distributed under the plan on account of each allowed unsecured claim is not less than the amount that would have been paid on such claim if the estate of the debtor had been liquidated under chapter 7 of this title on such date; and (3) modification of the plan is not practicable.  11 U.S.C. § 1328(b)(1)-(3).  The Court found that although the Debtor has experienced health difficulties, there is no evidence that the health problems amount to a "catastrophic circumstance" that would preclude him from holding any gainful employment.  Accordingly, the Court denied the Debtor’s application for a hardship discharge.

Date: 
Friday, May 16, 2008
Category: 
Discharge
Chapter: 
13