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Cause of Action: 

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* This order and judgment is not binding precedent, except under the

doctrines of law of the case, res judicata, and collateral estoppel. 10th Cir. BAP

L.R. 8018-6(a).

1 Honorable Howard R. Tallman, United States Bankruptcy Judge, United

States Bankruptcy Court for the District of Colorado, sitting by designation.

FILED

U.S. Bankruptcy Appellate Panel

of the Tenth Circuit

January 31, 2007

Barbara A. Schermerhorn

Clerk NOT FOR PUBLICATION

UNITED STATES BANKRUPTCY APPELLATE PANEL

OF THE TENTH CIRCUIT

IN RE MICHAEL WAYNE

VANNORDSTRAND, also known as

Mike Wayne Vannordstrand,

Debtor.

BAP No. KS-05-091

MICHAEL WAYNE

VANNORDSTRAND,

Appellant,

Bankr. No. 02-40431-13

 Chapter 13

v. ORDER AND JUDGMENT*

JAN M. HAMILTON, Trustee,

Appellee.

Appeal from the United States Bankruptcy Court

for the District of Kansas

Before CLARK, CORNISH, and TALLMAN1, Bankruptcy Judges.

CLARK, Bankruptcy Judge.

Debtor Michael Vannordstrand (“Debtor”) appeals the bankruptcy court’s

“Order Granting Trustee’s Motion for Turnover of Inheritance,” entered on

August 19, 2005. We affirm.

BAP Appeal No. 05-91 Docket No. 1 Filed: 01/31/2007 Page: 1 of 5
2 Pierce v. Underwood, 487 U.S. 552, 558 (1988).

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I. BACKGROUND

The facts giving rise to this appeal are uncontested. Debtor filed for

Chapter 13 relief on March 1, 2002. His proposed plan was approved by

confirmation order entered on June 20, 2002. Debtor’s plan provides for delayed

vesting of estate property in Debtor until dismissal or discharge. In February

2004, while still making payments under the plan, Debtor received approximately

$40,000 in an inheritance from his aunt. Debtor subsequently disclosed the

inheritance to the Trustee, but did not seek to exempt it. The Trustee filed a

motion for turnover of the inheritance funds on March 29, 2005, to which Debtor

objected. Following a hearing, the bankruptcy court entered an order on August

19, 2005, granting the Trustee’s motion. Debtor timely filed his notice of appeal

from that Order on September 16, 2005, pursuant to an order extending the time

to appeal.

II. ISSUE AND STANDARD OF REVIEW

The single issue on appeal is whether the inheritance monies belong to the

Debtor, or are instead property of his estate. Since the facts are undisputed, this

issue presents only a legal question, which is reviewed by this Court de novo.

2

III. DISCUSSION

Debtor contends that the inheritance he received is not estate property

under 11 U.S.C. § 541(a)(5) because it was neither owned by him at the

commencement of his case, nor obtained by him within 180 days of the filing of

his petition. If this were a Chapter 7 proceeding, Debtor would be correct. 

However, in Chapter 13 proceedings, § 1306(a)(1) broadens the definition of

estate property to include “all property of the kind specified in [§ 541] that the

debtor acquires after the commencement of the case but before the case is closed,

dismissed, or converted” (emphasis added). Debtor does not contend that, at the

BAP Appeal No. 05-91 Docket No. 1 Filed: 01/31/2007 Page: 2 of 5
3 283 B.R. 783 (Bankr. D. Kan. 2002). 

4 Brief of Appellant at 7.

5 Unlike the Debtor herein, the debtors in Richardson claimed an exemption

in the proceeds. Although no objection to the exemption was made, the court

ruled that the exemption was improper because exemptions apply only to property

of the debtors’ estate, which it ruled the insurance proceeds were not. 

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time that he received the inheritance, his case had been closed, dismissed, or

converted.

However, Debtor contends that literal application of § 1306 would be

“absurd,” and would require turnover of property received in excess of five years

after filing of the petition. He relies on In re Richardson3

 for the proposition that

property obtained more than 180 days after commencement of a Chapter 13 case

is “not property of the estate by the plain provisions of 11 U.S.C. § 541(a) . . . .”4

Thus, Debtor essentially contends that § 541 overrides § 1306. However, Debtor

misconstrues the Richardson decision.

 In Richardson, the court considered the effect of § 1306(a)(1) on life

insurance proceeds paid to Chapter 13 debtors following the death of their son. 

The proceeds were received fourteen months after the filing of debtors’ petition,

and ten months after the confirmation order had been entered.5

 The court

determined that the proceeds were neither property of the estate nor disposable

income payable through the plan. However, that conclusion was not based on

§ 541(a). Instead, the court concluded, pursuant to 11 U.S.C. § 1327(b), that

ownership of all estate property not designated for use in the plan had vested in

the debtors upon confirmation of the plan.

A number of cases within the Tenth Circuit have considered “ownership” of

property in a Chapter 13 context, and have reached various conclusions. The

issue has not been directly addressed by the Tenth Circuit Court of Appeals, and

has not been addressed at all by the Tenth Circuit BAP. Universally, and contrary

BAP Appeal No. 05-91 Docket No. 1 Filed: 01/31/2007 Page: 3 of 5
6 See, e.g., In re Brensing, 337 B.R. 376, 383 (Bankr. D. Kan. 2006); In re

Johnson, 335 B.R. 805, 806 (Bankr. W.D. Tenn. 2006); In re Drew, 325 B.R. 765,

770 (Bankr. N.D. Ill. 2005); Montclair Prop. Owners Ass’n, Inc. v. Reynard (In re

Reynard), 250 B.R. 241, 245 (Bankr. E.D. Va. 2000); In re Solis, 137 B.R. 121,

126 (Bankr. S.D.N.Y. 1992).

7 Chapter 13 Debtor’s Plan at 2, in Appendix of Appellant at 29. Similarly,

though somewhat inartfully, the Order Confirming Plan at ¶ 10 provides that

“[a]fter approval of the Trustee’s Final Report and Account by the Court, all

property of the bankruptcy estate which is not proposed or reasonably

contemplated to be distributable under the Plan, shall revest in the debtor

following dismissal or discharge.” Id. at 31. 

8 Transcript of Oral Proceedings in Addendum to Brief of Appellant at 59,

62-63.

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to the present Debtor’s contention, the cases agree that § 1306 modifies the § 541

time period in Chapter 13 cases.6

 However, courts disagree regarding § 1327(b)’s

impact on § 1306(a)(1). Section 1327(b) provides that, “[e]xcept as otherwise

provided in the plan or the order confirming the plan, the confirmation of a plan

vests all of the property of the estate in the debtor.” The disputed issue is

whether or not the “vesting” of estate property in the debtor acts to terminate

§ 1306's inclusion of post-petition acquired property in the estate.

This Court need not enter this debate, since the Debtor’s plan specifically

delays vesting, stating that “[p]roperty of the estate shall vest in the debtor upon

discharge hereunder.”7

 It was this provision upon which the bankruptcy court

based its decision, stating, “because the Debtor’s own plan and confirmation order

clearly provide for delayed vesting, the Court finds that the inheritance is now

property of the estate.”8

 Since § 1327(b) specifically allows a plan to provide for

different vesting, and the plan in this case does so, vesting had not yet occurred

when Debtor obtained the inheritance. Therefore, this Court may affirm the

bankruptcy court without deciding whether vesting under § 1327(b) is equivalent

to ownership. As noted by the bankruptcy court, Debtor “bargained for” the

ability “to cut off post-petition collection efforts against him for post-petition

BAP Appeal No. 05-91 Docket No. 1 Filed: 01/31/2007 Page: 4 of 5
9 Id. at 62.

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debts by retaining all property by the estate.”9 In so doing, he also eliminated any

argument he may have had that § 1327(b) modifies § 1306(a)(1). 

IV. CONCLUSION

Since Debtor’s case had not been closed, dismissed, or converted when he

received the inheritance, that money is property of his estate. Therefore, the

bankruptcy court’s turnover order is affirmed.

BAP Appeal No. 05-91 Docket No. 1 Filed: 01/31/2007 Page: 5 of 5