PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

No. 12-2017

ROBERT D. MORT RANTA,

Debtor - Appellant,

v.

THOMAS PATRICK GORMAN,

Trustee – Appellee.

------------------------------

NATIONAL ASSOCIATION OF CONSUMER BANKRUPTCY ATTORNEYS,

Amicus Supporting Appellant.

Appeal from the United States District Court for the Eastern 

District of Virginia, at Alexandria. Claude M. Hilton, Senior 

District Judge. (1:12-cv-00505-CMH-TCB; 11-18842-RGM)

Argued: March 20, 2013 Decided: July 1, 2013

Before GREGORY and AGEE, Circuit Judges, and David A. FABER, 

Senior United States District Judge for the Southern District of 

West Virginia, sitting by designation.

Vacated and remanded by published opinion. Judge Gregory wrote 

the majority opinion, in which Judge Agee joined. Senior Judge 

Faber wrote a dissenting opinion.

ARGUED: Daniel Mark Press, CHUNG & PRESS, PC, McLean, Virginia, 

for Appellant. Eva Choi, OFFICE OF THE CHAPTER 13 TRUSTEE, 

Alexandria, Virginia, for Appellee. ON BRIEF: Tara A. Twomey,
2

NATIONAL ASSOCIATION OF CONSUMER BANKRUPTCY ATTORNEYS, San Jose, 

California, for Amicus Supporting Appellant.
3

GREGORY, Circuit Judge:

Robert D. Mort Ranta filed a voluntary petition for 

bankruptcy under Chapter 13 of the Bankruptcy Code, 11 U.S.C. 

§§ 1301-1330, seeking to adjust various secured and unsecured 

debts. The bankruptcy court denied confirmation of his proposed 

Chapter 13 plan on the grounds that it did not accurately 

reflect his disposable income and that it was unfeasible if Mort 

Ranta’s Social Security income was excluded from his “projected 

disposable income,” as Mort Ranta urged.1 The district court 

affirmed. We hold that the plain language of the Bankruptcy 

Code excludes Social Security income from the calculation of 

“projected disposable income,” but that such income nevertheless 

must be considered in the evaluation of a plan’s feasibility. 

For these reasons, we vacate and remand to the district court 

with instructions to remand the case to the bankruptcy court for 

further proceedings consistent with this opinion.

I.

At the time he filed the Chapter 13 petition, Mort Ranta 

owed $20,000 in arrears on his home mortgage loan, $12,981 in 

individual credit card debt, and $8,295 in joint credit card 

 1 Although the docket lists the appellant’s surname as 

“Ranta,” his correct surname, according to his counsel, is “Mort 

Ranta.” We therefore use “Mort Ranta” in the opinion.
4

debt with his wife. On Form B22(C), Mort Ranta reported a 

“current monthly income” of $3,097.46, a figure derived from the 

couple’s combined average monthly income from employment over

the previous six months.

On Form B6I (“Schedule I”), however, Mort Ranta reported 

his “combined average monthly income” as $7,492.10. That figure 

reflected the couple’s current monthly take-home pay from 

employment, plus an additional $3,319 in combined monthly Social 

Security benefits. His monthly expenses were reported on Form 

B6J (“Schedule J”) as $6,967.24. Subtracting that figure from 

his “combined average monthly income,” his “monthly net income” 

per Schedule J was $524.86.

Mort Ranta proposed a plan requiring payments of $525 per 

month for five years, for a total of $31,500. From that amount, 

the plan would pay off in full his mortgage arrears and joint 

credit card debt. However, his individual credit card debt 

would be paid off at less than one percent.2

The Trustee objected to the plan, claiming that it failed 

to dedicate Mort Ranta’s full “projected disposable income” to 

creditors as required by 11 U.S.C. § 1325(b)(1)(B).3

 2 Specifically, the plan would provide a distribution of 

.0042 on the individual credit card debt.

3 As explained below, § 1325(b)(1) applies when the Trustee 

or an unsecured creditor objects to a Chapter 13 plan. In that 

case, the plan may not be approved unless it (A) fully pays the 

(Continued)
5

Specifically, the Trustee contended that the expenses listed on 

Schedule J were overstated and that Mort Ranta’s disposable 

income therefore was higher than it appeared to be.

In a hearing before the bankruptcy court, Mort Ranta 

conceded that some of his expenses were overstated, but argued 

that his plan nevertheless complied with § 1325(b)(1)(B) because 

Social Security income is excluded from the calculation of 

“disposable income.” Thus, even after adjusting his expenses 

downward, he argued that his disposable income would be negative 

because his expenses would still exceed his non-Social Security 

income. As a result, Mort Ranta contended he was not required 

to make any payments to unsecured creditors under

§ 1325(b)(1)(B).

In a colloquy with the parties, the bankruptcy court 

determined that if Mort Ranta’s monthly payments were increased 

to reflect his actual net income, including Social Security, 

the total payments under the plan would be approximately 

$50,000. That amount would allow for full repayment of all 

debts, including the individual credit card debt that would be 

paid off at less than one percent under Mort Ranta’s proposed 

plan. Thus, the Trustee noted, the holder of that unsecured 

 

unsecured claim or (B) dedicates all the debtor’s “projected 

disposable income” during the commitment period to payments to 

unsecured creditors. 11 U.S.C. § 1325(b)(1)(B).
6

debt would either “get paid pretty much in full like everybody 

else or [under Mort Ranta’s proposed plan] they get nothing.”

The bankruptcy court agreed with the Trustee that Mort 

Ranta “[could] afford something greater [than what he proposed 

to pay] because there’s . . . income from Social Security.” The 

court then found that Mort Ranta’s plan was not feasible, 

explaining:

If you don’t want to count Social Security for the 

purposes of the income then I think you have to go 

back to the rule of law of disposable income. If 

you’re not going to add it to income you’re not going 

to have feasibility for the plan. It’s not feasible.

At this point, Mort Ranta asked the court to grant an 

interlocutory appeal, and the court denied his request. The 

court subsequently issued a written order denying confirmation 

of the plan and ordering the case dismissed in 21 days unless 

Mort Ranta took one of the actions enumerated in Rule 3015-2 of 

the Local Bankruptcy Rules for the United States Bankruptcy 

Court of the Eastern District of Virginia.4

Mort Ranta appealed to the United States District Court for 

the Eastern District of Virginia. In a motion for leave to 

appeal, Mort Ranta noted that “the majority rule is that denial 

 4 The enumerated actions include filing a new modified 

Chapter 13 plan, converting the case to another chapter of the 

Bankruptcy Code, filing a motion for reconsideration, or 

appealing the denial of confirmation. Bankr. Ct. R. 3015-

2(H)(3).
7

of confirmation is interlocutory,” but preserved his position 

that the denial should be considered a final order for purposes 

of appeal. The Trustee opposed the motion, arguing that the 

appeal did not meet the criteria for interlocutory appeal under 

28 U.S.C. § 158(a)(3).

Without addressing the basis for its jurisdiction or the 

motion for leave to file, the district court affirmed the 

bankruptcy court’s denial of confirmation in a written order.

The court reasoned:

In this case, the Bankruptcy Court appropriately 

found that the Debtor could afford to pay an amount 

greater than that proposed in his Chapter 13 plan.

Neither the Bankruptcy Code nor the Social Security 

Act prohibits a bankruptcy court from determining a 

debtor’s ability to repay his or her creditors, and in 

this case part of that consideration included Debtor’s 

supplemental Social Security retirement benefits.

Because Debtor voluntary[sic] chose not to include 

Social Security benefits for purposes of income in 

this particular case, the Bankruptcy Court found that 

Debtor’s proposed Chapter 13 Plan was not feasible.

. . . [T]hese findings of the Bankruptcy Court are 

neither erroneous nor contrary to law . . . .

Ranta v. Gorman, No. 1:12-CV-505 at 2 (E.D.V.A. August 6, 2012).

Mort Ranta timely appealed.

On appeal, Mort Ranta asks us to reverse the district 

court’s order affirming the bankruptcy court’s denial of 

confirmation, thereby overruling the Trustee’s objection to 

confirmation. He argues first that the Bankruptcy Code 

expressly excludes Social Security income from the calculation 
8

of projected disposable income; and second, that his plan is 

feasible based on his Social Security income. Before turning to 

the merits of his appeal, first we must satisfy ourselves of our 

appellate jurisdiction over the case.

II.

Mort Ranta asserts appellate jurisdiction under 28 U.S.C. 

§ 158(d)(1), which grants the courts of appeal jurisdiction over 

appeals from “all final decisions, judgments, orders, and 

decrees” entered by the district court sitting in review of the 

bankruptcy court.5 Both the district court order and the 

bankruptcy court order must be final for our jurisdiction to be 

proper under § 158(d)(1). See In re Computer Learning Ctrs., 

Inc., 407 F.3d 656, 660 (4th Cir. 2005).

When a bankruptcy debtor’s proposed plan is confirmed, we 

have generally allowed creditors and trustees whose objections 

to the plan were overruled to appeal as a matter of right. See, 

eg., In re Quigley, 673 F.3d 269, 270 (4th Cir. 2012) (trustee’s 

appeal from district court’s affirmance of bankruptcy court 

order overruling in part trustee’s objection to proposed plan); 

Neufeld v. Freeman, 794 F.2d 149, 150 (4th Cir. 1986) 

 5 Mort Ranta does not claim to have complied with the 

procedure for certifying a direct appeal under § 158(d)(2).
9

(creditor’s appeal from district court’s affirmance of

bankruptcy court’s confirmation of proposed plan).

By the same token, we have a long history of allowing 

appeals from debtors whose proposed plans are denied

confirmation, without questioning the finality of the underlying 

order. See, eg., In re Coleman, 426 F.3d 719, 722, 727 (4th 

Cir. 2005) (appeal from bankruptcy court order, affirmed by 

district court, withdrawing confirmation of debtor’s plan and 

granting debtor 30 days to file an amended plan); In re Witt, 

113 F.3d 508, 509, 513 (4th Cir. 1997) (appeal from district 

court order reversing bankruptcy court’s confirmation of plan 

and remanding to allow debtor to propose amended plan); In re 

Solomon, 67 F.3d 1128, 1130-31 (4th Cir. 1995) (appeal from 

bankruptcy court order, affirmed by district court, denying

confirmation of plan); Caswell v. Lang, 757 F.2d 608, 608 (4th 

Cir. 1985) (same); Deans v. O’Donnell, 692 F.2d 968, 968 (4th 

Cir. 1982) (same).6

However, as described below, the finality of an order

denying confirmation of a proposed plan but not dismissing the 

 6 In tension with this practice, in an unpublished decision 

we once dismissed an appeal similar to the one at bar for lack 

of appellate jurisdiction. See In re Massey, 21 F. App’x 113, 

114 (4th Cir. 2001) (per curiam) (unpublished). This decision 

has minimal persuasive value, however, as it relied entirely on 

out-of-circuit authority without providing any independent 

reasoning. See id.
10

underlying bankruptcy petition is an issue that has divided 

other circuits. On one side, four circuits have held that such 

orders are strictly interlocutory, while two other circuits have 

held that they can be final for purposes of appeal. See infra

pp. 11-15. Given this circuit split, and the fact that we have 

not squarely addressed this issue before, we asked the parties 

to file supplemental briefs addressing the basis for our 

appellate jurisdiction. After considering the principles of 

finality unique to bankruptcy cases and the decisions of other 

circuits, we conclude that the bankruptcy court’s denial of Mort 

Ranta’s proposed plan and the district court’s affirmance are

final orders for purposes of appeal, and that our appellate 

jurisdiction is proper.

As we have recognized on many occasions, the concept of 

finality in bankruptcy traditionally has been applied in a “more 

pragmatic and less technical way” than in other situations.

McDow v. Dudley, 662 F.3d 284, 287 (4th Cir. 2011) (quoting 

Computer Learning Ctrs., 407 F.3d at 660). The reason for this

“relaxed rule of appealability” is that bankruptcy proceedings 

are often protracted, involving multiple parties, claims, and 

procedures, and postponing review of discrete portions of the 

action until after a plan of reorganization is approved could 

result in the waste of valuable time and scarce resources.

McDow, 662 F.3d at 287 (quoting A.H. Robins Co. v. Piccinin, 788 
11

F.2d 994, 1009 (4th Cir. 1986)). Thus, in bankruptcy cases, we 

allow immediate appellate review of orders that “finally dispose 

of discrete disputes within the larger case.” Id. at 287 

(quoting Computer Learning Ctrs., 407 F.3d at 660).7

Applying these principles, we have held final and 

appealable a variety of orders that resolve a specific dispute 

within the larger case without dismissing the entire action or 

resolving all other issues. See, eg., McDow, 662 F.3d at 286-90

(denial of trustee’s motion to dismiss bankruptcy case as 

abusive); Comm. of Dalkon Shield Claimants v. A.H. Robins Co., 

Inc., 828 F.2d 239, 241 (4th Cir. 1987) (denial of request by 

claimants for appointment of trustee); Piccinin, 788 F.2d at

1009 (order fixing venue).

By contrast, we have held interlocutory bankruptcy court 

orders that are provisional in nature and subject to revision,

and district court orders that remand the case to bankruptcy 

court without consideration of the merits of the appeal. See, 

eg., Computer Learning Ctrs., 407 F.3d at 661 (interim fee award 

subject to reevaluation by bankruptcy court); In re Wallace & 

 7 We have applied the same relaxed and pragmatic approach to 

finality whether the appeal is brought under 28 U.S.C. §§ 158 or 

1291. Compare McDow v. Dudley, 662 F.3d 284, 286-87 (4th Cir. 

2011) (applying the more pragmatic and less technical approach 

in an appeal brought under § 158), with Comm. of Dalkon Shield 

Claimants v. A.H. Robins Co., Inc., 828 F.2d 239, 241 (4th Cir. 

1987) (using the same approach in an appeal brought under 

§ 1291).
12

Gale Co., 72 F.3d 21, 23-24 (4th Cir. 1995) (district court 

order remanding case to bankruptcy court with instructions to 

certify an interlocutory appeal); In re Looney, 823 F.2d 788, 

790-91 (4th Cir. 1987) (bankruptcy court order continuing 

automatic stay until hearing on the merits of creditor’s motion 

for relief from stay).

In contrast to the interlocutory orders in those cases, 

here the bankruptcy court order clearly resolved a discrete 

issue, indeed, the only issue, in Mort Ranta’s bankruptcy case—

that is, whether his proposed Chapter 13 plan merits

confirmation. The bankruptcy court order denied confirmation of 

the proposed plan and directed the case dismissed unless Mort 

Ranta took further action, and the district court’s order simply 

affirmed. Nothing in either of the orders indicates that any 

issues concerning the proposed plan remained for the bankruptcy 

court’s consideration.

The argument against treating a denial of confirmation 

final for purposes of appeal rests primarily on the fact that

the debtor may propose an amended plan before the case is 

dismissed. The Second Circuit first articulated this reasoning 

in Maiorino v. Branford Sav. Bank, 691 F.2d 89 (2d Cir. 1982), 

which held that the denial of a Chapter 13 plan is 
13

interlocutory.8 As the Maiorino court explained, “[s]o long as 

the petition is not dismissed, it is open to the debtor to 

propose another plan, and . . . such a plan might well be 

acceptable to the parties or bankruptcy judge concerned.” 691 

F.2d at 91 (citation omitted). Following the Second Circuit, 

three other circuits have held that a decision denying 

confirmation of a proposed plan but not dismissing the 

underlying bankruptcy petition is an interlocutory order. See

In re Lievsay, 118 F.3d 661, 662 (9th Cir. 1997) (per curiam); 

Lewis v. United States, Farmers Home Admin., 992 F.2d 767, 773 

(8th Cir. 1993); In re Simons, 908 F.2d 643, 645 (10th Cir. 

1990) (per curiam). According to the Tenth Circuit, “[t]his

approach is entirely consistent” with two general principles 

regarding finality: (1) that an order is not final unless it 

“ends the litigation on the merits, leaving nothing for the 

court to do but execute the judgment”; and (2) that a district 

court order is not final if it “contemplates significant further 

proceedings in the bankruptcy court.” Simons, 908 F.2d at 644-

45.

 8 The jurisdictional statute at issue in that case was 

former 28 U.S.C. § 1293(b), which was replaced by 28 U.S.C. 

§ 158(d) when Congress enacted the Bankruptcy Amendments and 

Federal Judgeship Act of 1984, Pub. L. No. 98-353, 98 Stat. 333.

“Because both statutes contain the finality requirement, courts 

have applied the cases brought under section 1293(b) to section 

158(d) cases.” In re Brown, 803 F.2d 120, 122 n.3 (3d Cir. 

1986).
14

We are not persuaded that a denial of confirmation should 

be considered an interlocutory order simply because the debtor 

could propose an amended plan. That conclusion appears to be 

grounded upon standard finality principles, as demonstrated by 

the Tenth Circuit’s observations in Simons, rather than the more 

flexible approach to finality traditionally applied in

bankruptcy proceedings. Indeed, Maiorino, the seminal decision 

upon which nearly all other courts have relied, made no mention 

of a flexible approach, and instead opined that “[f]rom a policy 

point of view . . . there is something to be said in a day of 

burgeoning appellate dockets for taking care not to construe 

jurisdictional statutes . . . with great liberality.” 691 F.2d 

at 91. Although some courts have paid lip service to the 

flexible approach even as they have held denials of confirmation 

interlocutory, see, eg., In re Flor, 79 F.3d 281, 283 (2d Cir. 

1996) (per curiam); Lewis, 992 F.2d at 772, they have generally 

used the same reasoning as Maiorino--that such orders are 

interlocutory because additional proceedings are available--

which is consonant with a more rigid approach, see In re Bartee, 

212 F.3d 277, 282 n.6 (5th Cir. 2000) (observing that the Second 

and Tenth Circuits have “favor[ed] a rigid rule of finality” in 

holding that denials of confirmation are interlocutory).

Moreover, we find questionable the logic that denials of 

confirmation are interlocutory simply because the debtor may 
15

propose an amended plan, for the same can be said of a 

confirmation order. Even after a plan is confirmed, the debtor 

is always free to propose a modification to the plan, which 

could substantially modify the terms of repayment and the rights 

of creditors. See 11 U.S.C. § 1329(a). (Indeed, even the 

Trustee and the creditors may propose a modification. Id.)

We therefore agree with the more pragmatic approach of 

those circuits that have held that a denial of confirmation can 

be a final order for purposes of appeal even if the case has not 

yet been dismissed, recognizing that this conclusion “is all but 

compelled by considerations of practicality.” Bartee, 212 F.3d 

at 283; see also In re Armstrong World Indus., Inc., 432 F.3d 

507, 511 (3d Cir. 2005) (holding that a denial of confirmation 

was a final order for purposes of appeal, in part, due to 

“practical considerations in the interests of judicial 

economy”).9

As the Fifth Circuit explained in Bartee, a contrary rule 

could leave some debtors “without any real options in 

formulating [their] plan.” 212 F.3d at 283. Assuming an 

 9 While we find the decisions of these circuits persuasive, 

contrary to the dissent’s assertions, we do not adopt any of the 

methodology they use to evaluate finality in bankruptcy (such as 

multi-factor tests), which the dissent considers too 

“indeterminate.” See infra pp. 42 n.6, 43-44, 51-52. Rather, 

our decision is based on the principles of finality 

traditionally applied by our Circuit in bankruptcy cases. See

supra pp. 9-10.
16

interlocutory appeal is unavailable, the debtor who prefers the 

proposed plan and seeks to appeal the denial would be forced to 

“choose between filing an unwanted or involuntary plan and then 

appealing his own plan, or dismissing his case and then 

appealing his own dismissal.” Id. Forced to suffer dismissal, 

the debtor could lose the automatic stay on foreclosure and 

collection actions that takes effect upon the filing of the 

Chapter 13 petition, see 11 U.S.C. § 362, and could be precluded

from filing another bankruptcy petition for six months, see id.

§ 109(g). Forced to propose an unwanted plan, the debtor would 

waste “valuable time and scarce resources,” McDow, 662 F.3d at 

287, on a plan proposed only for the purpose of obtaining 

appellate review of the earlier order.10 Thus, as a practical 

matter, it makes little sense to deny debtors immediate 

 10 In addition, the procedural oddity of allowing a debtor 

to appeal the confirmation of his or her own proposed plan 

raises questions regarding standing. To have standing to appeal 

a bankruptcy order, the appellant must be a “person aggrieved” 

by the order, that is, a person “directly and adversely affected 

pecuniarily.” In re Urban Broad. Corp., 401 F.3d 236, 243-44 

(4th Cir. 2005). Although the Eighth Circuit has held that a 

debtor forced to propose an amended plan has standing to appeal 

as a “person aggrieved” by the confirmation order, see In re 

Zahn, 526 F.3d 1140, 1142 (8th Cir. 2008) (reversing the 

contrary ruling of the Bankruptcy Appellate Panel), we have not 

yet addressed this issue.
17

appellate review simply because the case has not yet been 

dismissed and the debtor could propose an amended plan.11

In arguing that the denial of confirmation should be 

considered interlocutory, the dissent contends that a “discrete 

dispute” should be limited, for purposes of evaluating the 

finality of a bankruptcy order, to “situations where one 

creditor’s rights become fixed while other issues in the 

bankruptcy case remain unresolved.” Infra p. 40. However, our 

Circuit has never articulated such a strict rule. Instead, as 

described above, we have held final a variety of orders that 

resolved a discrete dispute without fixing the rights of any one 

creditor. See infra p. 10 (collecting cases).

The dissent also contends that our decision “needlessly 

expands appellate jurisdiction” in bankruptcy, encouraging 

“start-and-stop” appeals from debtors whose plans are denied 

confirmation, discouraging negotiation and mediation in 

reorganization cases, and hampering the very aim of judicial 

economy guiding our decision. Infra p. 54. We disagree. 

First, as described above, our Court has a long history of 

 11 The dissent argues that our reasoning “assumes too much 

of the debtor’s intent.” Infra p. 53. However, it is reason, 

not assumption, which leads us to conclude that the initial plan 

proposed by the debtor is the debtor’s preferred plan--

especially given that the Bankruptcy Code requires Chapter 13 

debtors to propose their plans in good faith, see 11 U.S.C. 

§ 1325(a)(3)--and therefore that some debtors will disagree with 

the denial of confirmation and want to appeal the decision.
18

allowing appeals from debtors whose proposed plans are denied 

confirmation. Infra p. 8. Our holding today does not extend 

our appellate jurisdiction but instead justifies its existing 

parameters.12

Moreover, we see no reason to assume that debtors faced 

with a denial of confirmation will waste their resources on a 

gratuitous appeal simply because the option to appeal is 

available, when an amended plan would provide all the relief 

needed. Thus, to the extent the dissent suggests that our 

decision will encourage an onslaught of senseless “start-andstop appeals,” undermining judicial economy, see infra p. 54, we 

disagree. Indeed, the alternative adopted by the courts upon 

which the dissent relies, that is, allowing debtors to appeal 

the denial of confirmation after an amended plan is confirmed, 

see, eg., In re Zahn, 526 F.3d 1140, 1143-44 (8th Cir. 2008), is 

hardly less economical, for it simply delays the inevitable in 

cases where the amended plan is unacceptable to the debtor.

Finally, we do not think it necessary to treat denials of 

confirmation as interlocutory in order to encourage negotiation 

and mediation in reorganization cases. As noted by the dissent 

 12 We do not rely, as the dissent suggests, infra pp. 45-46, 

on any sub silentio holdings in the cases cited infra page 8. 

Rather, we cite these cases to show that our Circuit has a 

history of hearing appeals from denials of confirmation, even if 

we have not yet squarely addressed the basis for our 

jurisdiction.
19

in Maiorino, the effect of such a rule is that “when creditors 

lose and a plan is confirmed, creditors may appeal immediately 

as of right,” but “when debtors lose and a plan is rejected, 

they may appeal only by leave of the [reviewing] court,” 691 

F.2d at 95 (Lumbard, J., dissenting). Given that “Congress 

enacted Chapter 13 to aid consumer debtors,” id., whatever the 

value of negotiation and mediation in Chapter 13 cases, that 

value is best fostered by an even playing field that affords

debtors the same access to relief on appeal as creditors when a

decision regarding the proposed plan is adverse to their 

interests.13

In sum, because it is evident from the face of the 

underlying orders that confirmation of Mort Ranta’s proposed 

plan was finally denied, it would make little sense to force 

Mort Ranta to suffer dismissal or to waste resources on an 

amended plan before obtaining appellate review. Such a rule 

would be inconsistent with the pragmatic, less technical

approach to finality we apply in bankruptcy proceedings. We 

 13 The dissent also argues that our decision “effectively 

reads out” the avenues for interlocutory relief afforded by the 

certification provisions of 28 U.S.C. §§ 158(d)(2) and 1291(b). 

Infra p. 54. This is not so. Those provisions remain available

to authorize direct appeals from any number of bankruptcy court 

rulings on novel or disputed legal issues, or other issues of 

importance, without regard to the finality of the underlying 

order. We simply hold, regardless of whether this case presents 

such an issue, that the denial of confirmation is appealable as 

a final order.
20

therefore conclude that the bankruptcy court’s denial of 

confirmation and the district court’s affirmance are final 

orders for purposes of appeal under § 158(d)(1), and our 

appellate jurisdiction is proper.14

III.

Turning to the merits of the appeal, Mort Ranta argues that 

the bankruptcy court erred in denying confirmation of his plan 

because the Bankruptcy Code excludes Social Security income from 

the calculation of “projected disposable income,” and because 

his plan is feasible based on consideration of that income. 

When reviewing a decision by a district court sitting in its 

capacity as a bankruptcy appellate court, we review the factual 

findings of the bankruptcy court for clear error and the legal 

conclusions de novo. In re Kirkland, 600 F.3d 310, 314 (4th 

Cir. 2010). Because this appeal presents only questions of 

statutory interpretation and the facts are undisputed, our 

review is de novo. In re White, 487 F.3d 199, 204 (4th Cir. 

2007).

 14 During the pendency of this appeal, the bankruptcy court 

conditionally confirmed Mort Ranta’s proposed plan pending the 

outcome of his appeal to allow the Trustee to disburse to 

creditors funds Mort Ranta had paid to the Trustee. Mort Ranta 

argues that the conditional confirmation order cures any defect 

in the finality of the denial of confirmation. Because we hold 

that the denial of confirmation is final and appealable, we do 

not reach this argument.
21

A.

Chapter 13 of the Bankruptcy Code allows debtors with 

regular income to repay or discharge certain debts after making 

payments to creditors for a specified commitment period, 

generally three to five years. See 11 U.S.C. §§ 1301-1330. To 

obtain relief, the debtor must propose a debt adjustment plan 

that meets all the requirements for confirmation set forth in 

the Code. See id. §§ 1322, 1325. Relevant here, if the Trustee 

or an unsecured creditor objects to confirmation of the plan, 

the plan must either fully pay the unsecured claim or provide 

that all the debtor’s “projected disposable income” to be 

received during the applicable commitment period will be applied 

to make payments to unsecured creditors. Id. § 1325(b)(1).

Prior to 2005, the Code defined disposable income as “income 

which is received by the debtor” less amounts reasonably 

necessary for the maintenance or support of the debtor, certain 

charitable contributions, and certain business expenses. 11 

U.S.C. § 1325(b)(2) (2000). Based on this definition, “courts 

typically included Social Security benefits in the calculation 

of disposable income.” Baud v. Carroll, 634 F.3d 327, 347 (6th 

Cir. 2011) (collecting cases).

In 2005, however, Congress amended the definition of 

“disposable income” with the enactment of the Bankruptcy Abuse 

Prevention and Consumer Protection Act of 2005 (BAPCPA), Pub.L. 
22

No. 109–8, 119 Stat. 23 (2005). The Code now defines “disposable 

income” as “current monthly income received by the debtor” less 

“amounts reasonably necessary to be expended” for the 

maintenance or support of the debtor, certain charitable 

contributions, and certain business expenses. 11 U.S.C. 

§ 1325(b)(2). “[C]urrent monthly income” means the debtor’s 

average monthly income from all sources during the previous six 

months, excluding, among other things, “benefits received under 

the Social Security Act.” Id. § 101(10A). Thus, Social 

Security income is now excluded from the definition of 

“disposable income.” In addition, the Code now requires abovemedian income debtors to use the “means test”--a statutory 

formula for determining whether a presumption of abuse arises in 

Chapter 7 cases--when calculating the “amounts reasonably 

necessary to be expended” for the debtor’s maintenance or 

support. See id. §§ 1325(b)(3), 707(b)(2). As a result, only 

certain specified expenses are included in the above-median 

income debtor’s “amounts reasonably necessary” for maintenance 

or support. Id. For below-median income debtors, however, the 

full amount reasonably necessary for maintenance and support is 

included. See § 1325(b)(2)(A)(i).

Although the Bankruptcy Code defines the term “disposable 

income,” it does not specifically define “projected disposable 

income.” However, in Hamilton v. Lanning, the Supreme Court 
23

explained that “projected disposable income” should be 

calculated based on “disposable income,” using a “forwardlooking approach.” 130 S. Ct. 2464, 2469 (2010). First, the 

debtor’s “disposable income” should be multiplied by the number 

of months in the debtor’s plan, and in most cases the result 

will be determinative. Lanning, 130 S. Ct. at 2471. However, 

“in exceptional cases, where significant changes in a debtor’s 

financial circumstances are known or virtually certain, the 

bankruptcy court has discretion to make an appropriate 

adjustment.” Id.; see also In re Quigley, 673 F.3d 269, 273-74 

(4th Cir. 2012) (noting that under Lanning, bankruptcy courts 

may account for foreseeable changes in both income and 

expenses).

Following Lanning, a debtor’s “projected disposable income” 

is based on the debtor’s “disposable income,” give or take any 

adjustments necessary to account for foreseeable changes in that 

income. Because the Code expressly excludes Social Security 

income from “current monthly income,” and thus, “disposable 

income,” it follows that Social Security income must also be 

excluded from “projected disposable income.” Indeed, every 

other circuit to address this issue has arrived at the same 

conclusion. See In re Welsh, 711 F.3d 1120, 1127 n.28, 1130-31 

(9th Cir. 2013) (noting that the statute clearly excludes Social 

Security income); In re Ragos, 700 F.3d 220, 223 (5th Cir. 2012) 
24

(same); In re Cranmer, 697 F.3d 1314, 1317-18 (10th Cir. 2012) 

(same); Baud, 634 F.3d at 345 (same).

The Trustee’s arguments to the contrary are neither 

persuasive nor consistent with the plain language of the Code. 

The Trustee first claims that the revised definition of 

“disposable income” applies only to above-median income debtors, 

not to below-median income debtors, like Mort Ranta. But the 

Code provides a single definition of “disposable income,” and 

that definition uses “current monthly income” as a starting 

point without differentiating between debtors of different 

income levels. 11 U.S.C. § 1325(b)(2). Although the Code goes 

on to distinguish between above-median income and below-median 

income debtors for purposes of calculating the “amounts 

reasonably necessary” for the debtor’s maintenance or support, 

id. § 1325(b)(3), there is no distinction on the income side.

Next, the Trustee argues that the Supreme Court’s decision 

in Lanning allows Social Security income to be included in 

“projected disposable income” even if it is excluded from 

“disposable income.” In Lanning, however, the Court held only 

that foreseeable changes in the debtor’s financial circumstances 

may be taken into account when calculating “projected disposable 

income,” not that the basic formula for “disposable income” may 

be ignored. See Cranmer, 697 F.3d at 1318 (“[N]othing in 

Lanning suggests a court may disregard the Code’s definition of 
25

disposable income in calculating projected disposable income.”); 

Baud, 634 F.3d at 345 (“[T]he discretion Lanning affords . . . 

does not permit the court to alter the items to be included in 

and excluded from income.”). We do not consider Lanning to 

authorize the bankruptcy court to read out of the Code the 

BAPCPA’s revisions to the definition of “disposable income.”

“If Congress excluded social security income from current 

monthly income and disposable income, it makes little sense to 

circumvent that prohibition by allowing social security income 

to be included in projected disposable income.” Ragos, 700 F.3d 

at 223.

The Trustee also argues that Social Security income must be 

included in the calculation of a below-median income debtor’s 

“disposable income” because Schedule I contains a line for its 

inclusion. The Trustee contends that Schedule I is used with 

Schedule J to calculate the disposable income of below-median 

income debtors. The language of the forms, however, does not 

support the Trustee’s contention. Schedule I states that it 

calculates “average monthly income,” not “current monthly 

income.” And Schedule J, which references Schedule I, 

calculates “monthly net income,” not “disposable income.” The 

bankruptcy court may not “disregard the Code’s definition of 

disposable income . . . simply because there is a disparity 

between the amount calculated using that definition and the 
26

debtor’s actual available income as set forth on Schedule I.” 

Baud, 634 F.3d at 345.

Given the Trustee’s confusion over this issue, we emphasize 

that, for all debtors, the starting point for calculating 

projected disposable income is the debtor’s “current monthly 

income,” which is provided by Form B22(C). For above-median 

income debtors, Parts IV and V of Form B22(C) allow the debtor 

to calculate “disposable income” by deducting the limited 

expenses allowed under the means test from the debtor’s “current 

monthly income.” For below-median income debtors, however, 

“disposable income” should be calculated by subtracting the full

amount “reasonably necessary to be expended” for the debtor’s 

support or maintenance, based on information provided in

Schedule J, from the “current monthly income” figure. Using the 

“disposable income” figure, “projected disposable income” should 

then be calculated consistent with the Supreme Court’s 

instructions in Lanning.

Finally, the Trustee argues that failing to require belowmedian income debtors to include Social Security income in their 

“projected disposable income” would contravene Congress’ intent 

to eradicate bankruptcy abuse when it enacted the BAPCPA. See

Ransom v. FIA Card Servs., N.A., 131 S. Ct. 716, 721 (2011) 

(“Congress enacted the [BAPCPA] to correct perceived abuses of 

the bankruptcy system. In particular, Congress adopted the 
27

means test . . . to help ensure that debtors who can pay 

creditors do pay them.”) (internal quotation marks and citations 

omitted). For instance, the Trustee argues that if Social 

Security income is not included, then debtors will have total 

discretion to dictate the amount of income they want to 

contribute to the plan. But this is not necessarily so. It is 

true that a Chapter 13 debtor with zero or negative “projected 

disposable income” is not required to apply any income to 

payments to unsecured creditors under § 1325(b)(1)(B). The 

debtor’s plan, however, still must satisfy every other 

requirement for confirmation set forth in the Code. Among other 

requirements, the plan must meet the “best interests of the 

creditors” test, i.e., unsecured creditors must not receive less 

than they would in a Chapter 7 liquidation of the estate, 11 

U.S.C. § 1325(a)(4), and the plan must have been proposed in 

good faith, id. § 1325(a)(3).15

 15 We note, however, that the exclusion of Social Security 

income from disposable income, as required by statute, by 

itself, does not constitute bad faith. See In re Ragos, 700 

F.3d 220, 227 (5th Cir. 2012) (“[R]etention of exempt social 

security benefits alone is legally insufficient to support a 

finding of bad faith under the Bankruptcy Code); In re Cranmer, 

697 F.3d 1314, 1319 (10th Cir. 2012) (“When a Chapter 13 debtor 

calculates his repayment plan payments exactly as the Bankruptcy 

Code and the Social Security Act allow him to, and thereby 

excludes SSI, that exclusion cannot constitute a lack of good 

faith.”).
28

More fundamentally, the concerns over abuse raised by the 

Trustee are best addressed to Congress, not to this Court. The 

function of the judiciary is to apply the law, not to rewrite it 

to conform with the policy positions of litigants. When the 

statutory language is clear, as it is in this case, our inquiry 

must end. See In re Sunterra Corp., 361 F.3d 257, 265 (4th Cir. 

2004) (“As a settled principle, unless there is some ambiguity 

in the language of a statute, a court’s analysis must end with 

the statute’s plain language.” (internal quotation marks, 

citations, and alteration omitted)).16

In sum, we hold that, for both above-median income and 

below-median income debtors, Social Security income is excluded 

from the calculation of “projected disposable income” under 

§ 1325(b)(2).

B.

We next address whether the district court erred when it 

disregarded Mort Ranta’s Social Security income for purposes of 

evaluating whether his plan was feasible. The “feasibility” 

requirement is expressed in § 1325(a)(6), which states that the

 16 Because we hold that the Bankruptcy Code expressly 

excludes Social Security income from the calculation of 

“projected disposable income,” we do not reach Mort Ranta’s 

alternative argument that the Social Security Act protects 

Social Security income from the operation of Chapter 13 

proceedings. See 42 U.S.C. § 407.
29

plan shall be confirmed if “the debtor will be able to make all 

payments under the plan and to comply with the plan.”

The bankruptcy court reasoned that if Social Security 

income is excluded from “disposable income,” then it must also 

be excluded when evaluating whether the plan is feasible. But 

nothing in the Code supports this conclusion.

Section 1325(a)(6) simply states that a debtor must be able to 

make the payments required by the plan; it does not state that 

only “disposable income” may be used to make payments. Further, 

it has long been established that Social Security income may be 

used to fund a Chapter 13 plan. See 11 U.S.C. § 109(e) 

(allowing individuals with “regular income” to be debtors under 

Chapter 13); United States v. Devall, 704 F.2d 1513, 1516 (11th 

Cir. 1983) (explaining that originally only “wage earners” could 

file under Chapter 13, and that in 1978 Congress amended the 

Code to extend relief to individuals with “regular income,” in 

part, to benefit Social Security recipients) (citing S.R. No. 

95–989, at 13 (1978), 1978 U.S.C.C.A.N. 5799; H.R. No. 95–595, 

(1977), 1978 U.S.C.C.A.N. 5963, 6080); see also Hon. W. Homer 

Drake, Hon. Paul W. Bonapfel & Adam M. Goodman, Chapter 13 

Practice and Procedure § 3:7 (2012) (noting that “permissible 

sources of regular income include . . . social security 

benefits”). According to the bankruptcy court’s interpretation 

of the Code, however, it is unlikely that a debtor whose primary 
30

source of income is Social Security could ever propose a 

confirmable plan, for the debtor would be unable to prove 

feasibility. There is no indication Congress intended to throw 

this kind of obstacle to relief in the way of Social Security 

recipients when it revised the definition of “projected 

disposable income” with the BAPCPA.

We therefore hold, in agreement with the Sixth Circuit, 

that “a debtor with zero or negative projected disposable income 

may propose a confirmable plan by making available income that 

falls outside of the definition of disposable income—such as 

. . . benefits under the Social Security Act—to make payments 

under the plan.” Baud, 634 F.3d at 352 n.19; see also In re 

Kibbe, 361 B.R. 302, 314 n.11 (B.A.P. 1st Cir. 2007) (per 

curiam) (noting that the revised definition of projected 

disposable income “does not preclude a debtor’s use of available 

monies excluded from the definition . . . to support the 

feasibility of the debtor’s plan). Thus, in evaluating whether 

a debtor will be able to make all payments under the plan and 

comply with the plan, the bankruptcy court must take into 

account any Social Security income the debtor proposes to rely 

upon, and may not limit its feasibility analysis by considering 

only the debtor’s “disposable income.” If the debtor’s actual 

net income, including Social Security income, is sufficient to 

cover all the required payments, the plan is feasible.
31

In arguing otherwise, the Trustee cites a single bankruptcy 

court case from another circuit, which we do not find 

persuasive. See In re Schanuth, 342 B.R. 601, 605 (Bankr. W.D. 

Mo. 2006) (holding that a debtor’s plan was not feasible because 

the monthly payments exceeded “disposable income”). The 

Schanuth court relied exclusively on bankruptcy cases predating 

the BAPCPA, without taking into account how the BAPCPA’s revised 

definition of “disposable income” affects the feasibility 

analysis. See id. n.11 (collecting cases). Although before the 

BAPCPA, it would make sense to find a plan unfeasible when 

“disposable income” exceeded the payments required by the plan, 

that is no longer the case.

For these reasons, we hold that when a Chapter 13 debtor

proposes to use Social Security income to fund a plan, the 

bankruptcy court must consider that income in evaluating the

plan’s feasibility under § 1325(a)(6).

IV.

Given that circumstances may have changed during the 

pendency of this appeal, we do not decide whether Mort Ranta’s 

plan should be confirmed, but instead remand the case to allow 

the bankruptcy court to reconsider the plan in light of our 

holdings. Accordingly, we vacate the order of the district court

and remand the case to the district court with instructions to
32

remand to the bankruptcy court for further proceedings 

consistent with this opinion.

VACATED AND REMANDED
FABER, Senior District Judge, dissenting:

I respectfully dissent from the majority's conclusion that 

the bankruptcy court's denial of confirmation of the debtor's 

Chapter 13 plan was a final order and, accordingly, believe that 

appellate jurisdiction is not proper in this case. The nature 

of appellate jurisdiction in bankruptcy, the effects of 

“flexible finality” on the same, and the weight of precedent 

from other circuit courts of appeals all compel my dissenting 

opinion.

I.

While federal district courts have original jurisdiction 

over all cases under the Bankruptcy Code, see 28 U.S.C. § 

1334(a)-(b), they also have appellate jurisdiction over, among 

other matters, bankruptcy court orders, whether final or 

interlocutory. See 28 U.S.C. § 158(a)(1), (3). Circuit courts 

of appeals also have appellate jurisdiction over final 

bankruptcy court orders as an additional layer of appellate 

review beyond the district court’s own appellate review. See 28 

U.S.C. § 158(d)(1)(stating that circuit courts of appeals have 

appellate jurisdiction over all final orders of a district court 
34

where that district court heard bankruptcy appeals pursuant to 

28 U.S.C. § 158(a)).1

Separately, circuit courts of appeals have direct appellate 

jurisdiction in bankruptcy, conditioned upon certification by 

the lower court involved in the bankruptcy proceeding. See 28 

U.S.C. § 158(d)(2)(A). This type of direct appeal in bankruptcy 

requires certification from a lower court that the bankruptcy 

order being appealed involves (1) a legal question where no 

circuit court of appeals or Supreme Court decision controls, (2) 

a matter of public importance, (3) a legal question requiring 

resolution of conflicting decisions, or (4) a situation where an 

interlocutory appeal might "materially advance the progress of" 

the bankruptcy case or proceeding below.2

 See id. Notably, an 

 1 In Connecticut National Bank v. Germain, the Supreme Court 

noted that 28 U.S.C. §§ 158(d)(1) and 1291 “do not pose an 

either-or proposition” regarding the courts of appeals’ 

appellate jurisdiction over final orders in bankruptcy. See

Connecticut Nat. Bank v. Germain, 503 U.S. 249, 253 (1992). 

Accordingly, the statutes overlap to an extent, granting 

appellate jurisdiction over final orders in bankruptcy to 

circuit courts of appeals through two points of authority.

2 28 U.S.C. § 158(d)(2) essentially grants appellate 

jurisdiction over interlocutory orders in bankruptcy to circuit 

courts of appeals. The Supreme Court has specifically held, 

however, that 28 U.S.C. § 158(d)(2) does not, by negative 

implication, limit circuit courts of appeals' appellate 

jurisdiction over interlocutory appeals pursuant to 28 U.S.C. § 

1292(b). Connecticut Nat. Bank v. Germain, 503 U.S. at 253.

Accordingly, these statutes overlap in a manner similar to 28 

U.S.C. §§ 158(d)(1) and 1291. Additionally, while 28 U.S.C. §§ 

158(d)(2) and 1292(b) differ in ways largely irrelevant here, 

(Continued)
35

appeal under 28 U.S.C. § 158(d)(2), as opposed to an appeal

under 28 U.S.C. § 158(d)(1), does not stay any proceeding in the 

lower court from which the appeal is taken. See 28 U.S.C. § 

158(d)(2)(D). Instead, a lower court may, though it need not, 

affirmatively issue a stay when a circuit court of appeals 

receives an appeal under Section 158(d)(2). See id.

As the majority rightly notes, the debtor in this case 

"does not claim to have complied with the procedure for 

certifying a direct appeal" under 28 U.S.C. 158(d)(2). Supra p. 

7 n.5. However, the record clearly shows that the debtor 

attempted to comply with one or another procedure for obtaining 

interlocutory review, but either failed to comply fully or was 

denied such review. For example, at the confirmation hearing, 

the debtor asked the bankruptcy court to grant an interlocutory 

appeal. The bankruptcy court denied the debtor's request. The 

record also shows that the debtor, in his motion for leave to 

appeal to the district court, acknowledged that more circuit 

courts of appeals than not have held that a denial of 

confirmation of a Chapter 13 plan is interlocutory. On the one 

hand, the district judge below, in his written order affirming 

the bankruptcy court’s denial of confirmation, chose not to 

 

the two statutes are significantly similar in one regard—both 

contain procedural requisites for taking an interlocutory 

appeal.
36

address the basis for the district court's appellate 

jurisdiction. By the same token, the district judge did not 

opine that any issue in the debtor’s appeal merited 

interlocutory review. Just as the opportunity to pursue 

interlocutory review by the district court under 28 U.S.C. § 

158(a)(3) was quashed at the bankruptcy court level, the 

opportunity to pursue interlocutory review by this Court was 

lost at both the bankruptcy and district court levels, although 

not for the debtor’s lack of attempting to pursue interlocutory 

review.

As an alternative, the debtor now seeks to re-cast an 

interlocutory appeal as an appeal from a final order. The 

majority complied, citing the “flexible finality” concept unique 

to bankruptcy while simultaneously ignoring the significance of 

procedural requirements for taking an interlocutory appeal in 

bankruptcy.

II.

A.

Nearly all circuit courts of appeals agree that "the 

concept of 'finality' is more flexible in the bankruptcy context 

than in ordinary civil litigation." In re Flor, 79 F.3d 281, 

283 (2d Cir. 1996)(holding a denial of confirmation of a Chapter 

11 plan is interlocutory and reasoning that the Second Circuit's 
37

holding in Maiorino v. Bradford Savings Bank, a Chapter 13 case, 

"applies with comparable force" in the Chapter 11 

context)(citing Maiorino v. Branford Sav. Bank, 691 F.2d 89, 91 

(2d Cir. 1982)); see also In re Rudler, 576 F.3d 37, 43 (1st 

Cir. 2009)(noting that finality is given a more flexible 

interpretation in bankruptcy relative to other contexts). 

However, the Tenth Circuit Court of Appeals has specifically 

held that it does not apply a flexible finality standard in 

bankruptcy. In re Simons, 908 F.2d 643, 644 (10th Cir. 

1990)(noting that finality for purposes of 28 U.S.C. § 158 is 

interpreted in traditional, not flexible, terms). Nevertheless, 

flexible finality is not a novel concept in bankruptcy, and the 

purposes underlying its application persist over time.

The First Circuit Court of Appeals distilled the “flexible 

finality” concept in In re Saco Development Corporation after 

recognizing that application of traditional finality principles 

in bankruptcy would lead to “nearly insuperable obstacles to a 

finding of finality.”3 16 Charles Alan Wright, Arthur R. Miller 

 3 The majority apparently contends that Maiorino, because it 

did not distill flexible finality as Saco did only one year 

later, was blind to the need for such a concept in bankruptcy. 

In other words, the majority implies that Maiorino’s holding—

denial of confirmation of a Chapter 13 plan is interlocutory—was 

derived purely from traditional finality principles. See supra

p. 13. Saco’s tracing of the history of finality in bankruptcy 

refutes this as does the Second Circuit Court of Appeals’ 

(Continued)
38

& Edward H. Cooper, Federal Practice and Procedure § 3926.2, at 

326 (3d ed. 2012); see In re Saco Local Dev. Corp., 711 F.2d 441

(1st Cir. 1983)(Breyer, J.). In Saco, the bankruptcy court had 

ruled that an insurance company creditor in Chapter 7 

liquidation was “entitled to priority payment of Saco’s employee 

group life, health and disability insurance premiums.” Id. at 

442. While the maximum dollar amount of unpaid premiums for 

which the insurance company could receive priority treatment was 

$106,000, the actual amount was uncertain because the insurance 

company’s priority was subject to a reduction provided for wage 

priorities that other creditors might enjoy. Id. In this 

context, namely where one creditor’s rights are fixed vis-à-vis 

the bankruptcy estate generally but subject to alteration vis-àvis other creditors’ rights, the First Circuit Court of Appeals 

applied a “flexible finality” standard, holding that “an order 

that conclusively determines a separable dispute over a 

creditor’s claim or priority” is a final order, even when other 

creditors’ unfixed rights could ultimately alter the separable 

dispute’s outcome at a later stage in the bankruptcy case. Id.

at 445-46; see id. at 443 (acknowledging that “[w]ere this not a 

bankruptcy case, we doubt that the kind of order before us would 

 

confirmation of Maiorino’s holding in In re Flor. See generally 

Saco, 711 F.2d at 444-46; In re Flor, 79 F.3d at 283.
39

be considered ‘final.’”); cf. In re Bartee, 212 F.3d at 283 

(noting that the bankruptcy court’s order, among other things, 

“conclusively determined the substantive rights at issue and 

ended the dispute.”).

The same rationale from Saco applies, for example, when 

lower courts make debt dischargeability determinations, which 

are generally considered final orders under the “flexible 

finality” standard. See In re Gagne, 394 B.R. 219, 224-25 

(B.A.P. 1st Cir. 2008); In re Barrett, 337 B.R. 896, 898 (B.A.P. 

6th Cir. 2006) (aff’d 487 F.3d 353). Specifically, once a 

bankruptcy court determines whether a specific debt is 

dischargeable, all that remains is to enter judgment as to that 

specific debt. However, several other matters usually remain 

for the bankruptcy court’s determination. Nevertheless, the 

discharge of one debt can affect the status and rights of one or 

more creditors. Thus, although such a determination likely 

would not be final outside bankruptcy, see Saco, 711 F.2d at 

443, it is final inside bankruptcy precisely because “flexible 

finality” allows courts with appellate jurisdiction in 

bankruptcy to pluck sufficiently discrete disputes out of the 

larger, usually ongoing, bankruptcy case. In other words, 

“flexible finality” allows circuit courts of appeals to 

immediately review discrete disputes in bankruptcy cases where 

traditional finality standards would not. However, “flexible 
40

finality” does not, and should not, blend a circuit court of 

appeals' appellate jurisdiction over final orders as provided 

under 28 U.S.C. § 158(d)(1) with a circuit court of appeals' 

direct appellate jurisdiction over interlocutory matters as 

provided under 28 U.S.C. 158(d)(2) and 1292(b). Otherwise, to 

extend the concept of flexible finality too far would render 

useless the procedures for taking direct appeals in bankruptcy 

and would render as "mere surplusage" the statutory language 

outlining those procedures in 28 U.S.C. §§ 158(d)(2) and 

1292(b). See Freeman v. Quicken Loans, Inc., 132 S. Ct. 2034, 

2043 (2012)(stating that the canon against surplusage favors 

statutory interpretation that avoids rendering statutory text 

superfluous); In re Total Realty Management, LLC, 706 F.3d 245, 

251 (4th Cir. 2013)("Principles of statutory construction 

require a court to construe all parts to have meaning and, 

accordingly, avoid constructions that would reduce some terms to 

mere surplussage [sic].")(internal quotations omitted).4

 

Given the core purpose of the flexible finality standard in 

bankruptcy, denial of confirmation of a proposed reorganization 

 4 The majority obliquely responds to this argument by 

stating that, despite its holding today, avenues for 

interlocutory relief remain open. Supra p. 18 n.13. I do not 

dispute such avenues remain open. Rather, I contend such 

avenues become useless the more willing a court remains to 

stretch the concept of “flexible finality” in bankruptcy.
41

plan cannot convincingly be a “discrete dispute” appealable as a 

final order under any standard of finality. Indeed, Saco and 

others imply that a discrete dispute for purposes of “flexible 

finality” most properly refers to situations where one 

creditor’s rights become fixed while other issues in the 

bankruptcy case remain unresolved.5 Cf. Matter of Lybrook, 951 

F.2d 136, 137 (7th Cir. 1991)(orders in ongoing bankruptcy cases 

can be final when they “resolve[] a free-standing dispute of the 

sort that, outside of bankruptcy, would be an independent 

lawsuit.”)(Posner, J.). That is not this case. Essentially 

everything remains unresolved in the Chapter 13 bankruptcy 

below. The majority erroneously argues the opposite. 

Specifically, because “[t]he bankruptcy court’s order denied 

confirmation of [the debtor’s] plan and directed the case 

dismissed unless he took further action,” the majority concludes 

 5 A wholly reasonable exception to the standard discrete 

dispute justification for applying flexible finality is found in 

this Court’s holding in McDow v. Dudley, 662 F.3d 284 (2011). 

In McDow, this Court held that denying a motion to dismiss a 

Chapter 7 case as abusive, under 11 U.S.C. § 707(b), is a final 

order under “flexible finality.” Id. at 290. After a thorough 

examination of the nature of a § 707(b) motion, including the 

Congressional policy behind that provision, this Court 

concluded, in part, that allowing immediate appeal promoted the 

statutory purposes of the Bankruptcy Abuse Prevention and 

Consumer Protection Act of 2005. See id. Unlike in McDow, 

however, applying flexible finality to denial of confirmation of 

a reorganization plan serves no special Congressional purpose, 

contrary to the majority’s broad appeal to debtor sympathy. 

Supra p. 18.
42

that nothing remains for the bankruptcy court to do except enter 

dismissal, “unless [the debtor takes] further action.” Supra p. 

11. The majority’s diminution of the twenty-one day window 

within which the debtor may, among other things, file an amended 

plan and resume progress toward settling at least some 

expectations among the parties to the reorganization underscores 

the weakness of the position that “flexible finality” counsels a 

finding of finality when confirmation of a reorganization plan 

is denied. Indeed, an order cannot sensibly be final when it 

not only fails to dismiss the underlying case but additionally 

advises that a party may revise its own court filings.

B.

Without squarely addressing the merits, one can readily 

glean the debtor's aim from the record below—he seeks immediate 

resolution of what he asserts is a novel legal issue. Assuming 

the debtor is correct, his case’s legal novelty makes it a prime 

candidate for interlocutory review under 28 U.S.C. 158(d)(2) or 

28 U.S.C. 1292(b). However, any novelty of this case’s merits, 

and any eagerness to have this Court reach them, should not bend 

the judicially-crafted “flexible finality” concept such that it 

renders the multiple avenues for interlocutory appeals 

unnecessary.

However, I do not write separately to fault the debtor for 

not obtaining interlocutory review or failing to march in lock-
43

step with its attendant procedural formalities. Instead, I 

write separately, in part, to show how the statutory procedures 

for an interlocutory appeal in this case could have avoided the 

waste of judicial resources that has already occurred.6 Recall, 

pursuing an interlocutory appeal under either 28 U.S.C. § 

158(d)(2) or § 1292(b) does not automatically stay the 

proceedings below. See 28 U.S.C. §§ 158(d)(2)(D) and 1292(b). 

In other words, had the debtor pursued or been granted 

interlocutory review, the bankruptcy case could have proceeded 

below without pause. Creditor disbursements could have been 

made without stop-gap measures described below. The debtor 

could have filed an amended plan or converted his Chapter 13 

reorganization to Chapter 7 liquidation. Instead, the 

bankruptcy case below has been stayed pending this appeal. 

Indeed, to achieve the same end of making disbursements to 

creditors pending appeal of this case, the bankruptcy court 

 6 As explained more fully below, while encouraging judicial 

economy is a laudable goal and should be pursued where possible, 

enshrining that goal in a rule requiring application of a multifactor test for finality, as some circuit courts of appeals have 

done, results in a particularly indeterminate rule since 

“judicial economy” can be framed so many different ways. This 

is particularly troublesome when the rule bears so heavily on 

whether a court has jurisdiction, an issue that generally should 

not be fact-intensive or merits-based. See Matter of Lopez, 116 

F.3d 1191, 1194 (7th Cir. 1997)(“Jurisdictional rules ought to 

be simple and precise so that judges and lawyers are spared 

having to litigate over not the merits of a legal dispute but 

where and when those merits shall be litigated.”)(Posner, J.).
44

entered a conditional order confirming the debtor's plan. The 

bankruptcy court likely did not enter the conditional order 

because it suddenly changed its mind about the debtor's plan. 

Rather, the bankruptcy court likely entered the conditional 

order to address practical difficulties the Chapter 13 Trustee 

would face in administering a bankruptcy estate while an appeal 

of a purportedly final order to this Court was pending.7

 The 

conditional order’s text makes this point clear.

I also write separately to show that, with today’s ruling, 

this Court strays from the goal of “flexible finality,” 

reviewing discrete disputes within an ongoing bankruptcy case, 

instead choosing to join those circuit courts of appeals that 

have effectively made the test for “flexible finality” 

indeterminate. Consequently, along with the adoption of an 

 7 The debtor's argument that the bankruptcy court's 

conditional order confirming the debtor's plan cures any 

jurisdictional defect is meritless. First, as a definitional 

matter, the fact that the order is "conditional" eliminates the 

possibility that it is "final," unless conditions are satisfied. 

Here, the condition to be satisfied is this Court's decision on 

appeal. Second, the Chapter 13 Trustee, and not the debtor,

moved for the conditional order in this case. The Trustee did 

so in order to ensure continuous and orderly administration of 

the bankruptcy estate, because an appeal like the one in this 

case disrupts bankruptcy estate administration. Lastly, the 

debtor cites Equipment Finance Group, Inc. v. Traverse Computer 

Brokers, 973 F.2d 345 (4th Cir. 1992) to support his argument

that the conditional order cures any jurisdictional defect. 

That case does not apply here, where the order at issue is not a 

final judgment but instead is, patently, a conditional order.
45

indeterminate test for finality in bankruptcy arises the specter 

of jurisdiction creep.8 Bit by bit, the majority’s version of 

“flexible finality” will allow bankruptcy events less 

significant than denial of confirmation to be final for purposes 

of appeal,9 so long as the lower court “intended” finality or so 

long as judicial economy purportedly bends in just the right 

direction. In other words, the majority’s stated appeal to 

pragmatism equates to acquiescence to indeterminacy, a 

regrettable move endorsed by some circuit courts of appeals that 

have held that denial of confirmation of a reorganization plan 

can be a final order.

III.

A.

Regarding this Court’s precedent, the majority cites 

several cases that purportedly demonstrate a “long history of 

allowing appeals from debtors whose proposed plans are denied 

 8 See Thomas C. Marks, Jr., Jurisdiction Creep and the 

Florida Supreme Court, 69 Alb. L. Rev. 543 n.* (2006)(citing two 

related versions of the military term “mission creep” and 

drawing the strongest parallel with the latter, for purposes of 

the term “jurisdiction creep”). 

9 Thankfully, the majority has drawn a line where it will 

consider some bankruptcy matters interlocutory. Regrettably, 

however, the examples cited demonstrate the line’s inadequacy 

and, moreover, merely list types of decisions that are 

interlocutory by any measure—granting interim fee awards and 

continuing an automatic stay until a motion hearing is held, for 

example. See supra pp. 10-11.
46

confirmation, without questioning the finality of the underlying 

order.” Supra p. 8. The majority then relegates another of 

this Court’s cases to a footnote, assigning it “minimal 

persuasive authority” because it relied entirely on out-ofcircuit authority without any independent reasoning.” Supra p. 

8 n.6.; see In re Massey, 21 F. App’x 113 (4th Cir. 2001). 

However, while citing opinions that do not squarely address 

finality in bankruptcy and, by proxy, jurisdiction, the majority 

ignores this Court’s general distaste for relying on sub 

silentio holdings. See United States v. Horton, 693 F.3d 463, 

479 n.16 (4th Cir. 2012)(Agee, J.)(citing several Supreme Court 

and Fourth Circuit cases for the proposition that a sub silentio

holding is not binding precedent or, in other words, that this 

Court is “bound by holdings, not unwritten 

assumptions.”)(quoting Fernandez v. Keisler, 502 F.3d 337, 343 

n.2 (4th Cir. 2007)).

I find it a curious supposition that the persuasive value 

of a string of cases ignoring an issue ought to outweigh the 

persuasive value of a case that squarely addresses that same 

issue. See In re Massey, 21 F. App’x at 114 (4th Cir. 

2001)(holding that “[a]n order denying confirmation of a 

proposed Chapter 13 plan, without also dismissing the underlying 

petition or proceeding, is not final for purposes of appeal.”). 

Nevertheless, this is what the majority posits through its 
47

argument by analogy and reliance on sub silentio holdings. See

supra pp. 7-8. Otherwise, the majority’s assertion that its 

“holding today does not extend [this Court’s] appellate 

jurisdiction but instead justifies its existing parameters” goes 

unsupported since jurisdiction in this case depends on the 

finality of a denial of confirmation. See supra p. 17.

I recognize this Court’s general disposition with regard to 

its own unpublished opinions. See, e.g., Loc. R. 32.1 

(disfavoring citation to this Court’s unpublished opinions of a 

certain age). Nevertheless, I simply cannot find that reliance 

on sub silentio holdings or other assumptions is preferable. 

Accordingly, I believe this Court’s precedent is, at the very 

least, confused regarding whether a denial of confirmation of a 

reorganization plan is a final order and, as a result, I 

similarly believe that examining authority from other circuit 

courts of appeals as persuasive is appropriate in this case.

B.

More circuit courts of appeals than not have concluded that 

a denial of confirmation of a reorganization plan is not a final 

order in bankruptcy. See In re Flor, 79 F.3d 281, 283 (2d Cir. 

1996)(holding a denial of confirmation of a Chapter 11

reorganization plan was non-final, but noting that its holding 

derived from an earlier case, which held that a denial of 

confirmation of a Chapter 13 reorganization plan was non-
48

final)(citing Maiorino v. Branford Savings Bank, 691 F.2d 89 (2d 

Cir. 1982)); In re Zahn, 526 F.3d 1140, 1143-44 (8th Cir. 

2008)(holding a denial of confirmation of a Chapter 13 

reorganization plan was non-final); In re Lievsay, 118 F.3d 661, 

662 (9th Cir. 1997)(holding a denial of confirmation of a 

Chapter 11 reorganization plan was non-final); In re Simons, 908 

F.2d 643, 645 (10th Cir. 1990)(holding a denial of confirmation 

of a Chapter 13 reorganization plan was non-final). Other 

circuit courts of appeals, while not having squarely answered 

whether a denial of confirmation of a reorganization plan is a 

final order in bankruptcy, indicate they lean toward the

conclusion that a denial of confirmation is interlocutory. See

In re Watson, 403 F.3d 1, 5 (1st Cir. 2005)(holding that “even 

if [an earlier] order denying confirmation of the [Chapter 13] 

plan was not final at the time it was issued,” the order was 

later final after the debtor’s opportunity to file an amended 

plan or take other action had passed); In re Coffin, 435 B.R. 

780, 784 (B.A.P. 1st Cir. 2010)(noting, in general, that orders 

denying confirmation of a Chapter 13 reorganization plan are 

interlocutory, but holding that the order in that case satisfied 

the requirements in 28 U.S.C. § 158(a)(3) for taking an 

interlocutory appeal from the Bankruptcy Court to the First 

Circuit’s Bankruptcy Appellate Panel); cf. In re UAL Corp., 411 

F.3d 818, 821 (7th Cir. 2005)(Posner, J.)(noting that a “Chapter 
49

11 bankruptcy is not final until a plan of reorganization is 

confirmed.”). Two circuit courts of appeals have held that 

denial of confirmation of a reorganization plan can be final.10 

See In re Armstrong World Indus., Inc., 432 F.3d 507, 511 (3d 

Cir. 2005); In re Bartee, 212 F.3d 277, 283-84 (5th Cir. 

2000)(noting that, even under its intent-based inquiry, the 

Fifth Circuit Court of Appeals could find that denial of 

confirmation of a reorganization plan is interlocutory “if the 

order addressed an issue that left the debtor able to file an 

amended plan (basically to try again)”).

The majority argues that circuit courts of appeals that 

conclude denial of confirmation of a Chapter 13 plan is 

interlocutory apparently ground their decision “upon standard 

finality principles.” Supra p. 13. I do not believe this to be 

the case. Indeed, by so arguing, the majority projects the 

Tenth Circuit Court of Appeals’ reasoning in In re Simons onto 

the circuit courts of appeals that happen to agree with the 

Tenth Circuit Court of Appeals’ conclusion on this issue, 

despite their differing views on how finality is evaluated in 

bankruptcy. Recall, In re Simons explicitly grounded its 

conclusion upon standard finality principles. See In re Simons,

 10 I can find no circuit court of appeals that has held a 

denial of confirmation of a reorganization plan is per se a 

final order.
50

908 F.2d at 644. However, other circuit courts of appeals that 

conclude a denial of confirmation of a reorganization plan is 

interlocutory arrive at that conclusion despite the flexible 

concept of finality in bankruptcy proceedings. See In re Flor, 

79 F.3d at 283; In re Zahn, 526 F.3d at 1143. In other words, 

even keeping the flexible finality concept in mind, reasonable 

jurists conclude that a denial of confirmation of a 

reorganization plan is, nevertheless, interlocutory. This 

conclusion is not without reason.

For example, before deciding In re Flor, the Second Circuit 

Court of Appeals addressed the finality of a denial of plan 

confirmation in the context of Chapter 13 reorganization plans 

in Maiorino v. Branford Savings Bank, 691 F.2d 89 (2d Cir. 

1982). There, the Second Circuit Court of Appeals held that a 

denial of confirmation of a Chapter 13 plan is not a final 

order, even when an order confirming a plan is final. The 

Maiorino Court explained in more detail:

Nor do we find it strange as a matter of policy that 

an order confirming a plan which would, we agree, be 

final, is appealable by an objecting creditor while an 

order rejecting a proposed plan is not final and not 

appealable by the Chapter 13 debtor [except as an 

interlocutory appeal]. So long as the [Chapter 13 

bankruptcy] petition is not dismissed [. . .] it is 

open to the debtor to propose another plan, and for 

all that an appellate court would know in any given 

case such a plan might well be acceptable to the 

parties or bankruptcy judge concerned.
51

Maiorino, 691 F.2d at 91 (emphasis added). In In re Zahn, the 

Eighth Circuit Court of Appeals used similar reasoning to draw 

the distinction between the finality of confirmation of a 

reorganization plan and the interlocutory character of denial of 

confirmation of a reorganization plan. There, the Eighth 

Circuit Court of Appeals noted that orders denying confirmation 

of a reorganization plan “leave the way open for negotiations” 

among the debtor and various creditors laying claim to the 

bankruptcy estate. In re Zahn, 526 F.3d at 1143 (8th Cir. 

2008). Nevertheless, the majority apparently sees no reasoned 

basis for distinguishing between the finality of confirmation of 

a reorganization plan and the denial of confirmation of a 

reorganization plan, relying, in part, on the supposedly more 

pragmatic approach to “flexible finality” espoused by the Third 

and Fifth Circuit Courts of Appeals.

However, even In re Bartee provides some support for 

distinguishing between the finality of confirmation of a 

reorganization plan and denial of confirmation of a 

reorganization plan. There, the bankruptcy court’s order 

denying confirmation of the reorganization plan also classified 

a creditor’s claim as secured over the debtor’s objection; 

instead, the debtor wanted the secured creditor’s claim to be 

treated as unsecured and subject to the Bankruptcy Code’s 

cramdown provision. In re Bartee, 212 F.3d at 281. At that 
52

point, the secured creditor’s rights were fixed and no amount of 

amended Chapter 13 plans could change the secured creditor’s 

status. In other words, even though the bankruptcy court denied 

confirmation of the reorganization plan, it also fixed one 

party’s rights such that a “discrete dispute” existed within the 

larger bankruptcy case. Accordingly, the bankruptcy court order 

in In re Bartee both denied confirmation of the reorganization 

plan and fixed the secured party’s rights. On the latter basis 

alone, the bankruptcy court order in In re Bartee could perhaps 

be considered final under the “flexible finality” standard 

without needing to consider the question of a denial of 

confirmation’s finality.

Notwithstanding the unique factual issue in In re Bartee, 

the majority insists that a more “pragmatic” rule, like those 

adopted by the Third and Fifth Circuit Courts of Appeals, best 

suits denials of confirmation. However, as noted above, I 

believe these rules are too indeterminate to keep the “flexible 

finality” concept from effectively erasing the line between 

final and interlocutory orders in bankruptcy, a result 

inconsistent with flexible finality’s goal of immediately 

reviewing discrete disputes within an ongoing bankruptcy case. 

One set of commentators stated it well

the Third Circuit—with a close parallel in the Ninth 

Circuit—has taken flexibility at least as far as any, 

announcing an approach that could justify intensely 
53

case-specific analysis that would find finality 

whenever immediate appeal seems desirable. It seeks to 

effectuate a practical termination of the matter, 

considering the impact upon the assets of the bankrupt 

estate, the necessity for further fact-finding on 

remand, the preclusive effect of our decision on the 

merits on further litigation, and whether the interest 

of judicial economy would be furthered. These factors 

could lead almost anywhere. . .The interest of 

judicial economy can embrace the entire calculus of 

appealability. Decisions taking this approach all have 

reached results that seem sensible enough, but have 

not suggested any apparent limits

16 Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, 

Federal Practice and Procedure § 3926.2, at 339-342 (3d ed. 

2012). For these reasons, examining factors such as the lower 

court’s “intent” with regard to finality or enshrining judicial 

economy as part of a jurisdictional rule crafts not a rule but a 

set of exceptions. 

Separately, the majority highlights the Fifth Circuit Court 

of Appeals’ disfavor of a situation where a debtor “must choose 

between filing an unwanted or involuntary plan and then 

appealing his own plan, or dismissing his case and then 

appealing his own dismissal.”11 Id. I believe that this 

 11 On this point, the majority’s concerns regarding standing 

are unwarranted. See supra p. 15 n.10. When appealing one’s 

own plan, no matter how odd a procedure it might seem, a party 

can nonetheless be a “person aggrieved,” even if a second, 

third, or eighth amended plan is finally confirmed. This is so 

because each previous denial of confirmation—which I contend 

would be interlocutory—merges with the plan’s final 

confirmation. See In re Giesbrecht, 429 B.R. 682, 688 (B.A.P. 

9th Cir. 2010); In re Pearson, 390 B.R. 706, 710 (B.A.P. 10th 

(Continued)
54

rationale, which contrasts starkly with that used by the Second 

and Eighth Circuit Courts of Appeals as explained above, assumes 

too much of the debtor’s intent and, from a policy point of 

view, “there is something to be said in a day of burgeoning 

appellate dockets for taking care not to construe jurisdictional 

statutes—particularly those conferring power on the parties to 

agree to a direct appeal to the court of appeals—with great 

liberality.” Maiorino, 691 F.2d at 91. Moreover, the chance 

that a bankruptcy court might ultimately confirm a plan with 

which the debtor strongly disagrees should not override the 

value of negotiation in the plan formulation process.

IV.

Considering all of the jurisdictional statutes relevant 

here, the debtor's quest to shape Fourth Circuit law on the 

merits of his case might more properly have followed the routes 

 

Cir. 2008)(vacated as moot). This merger concept is not unique 

to bankruptcy. See, e.g., Shannon v. General Electric Co., 186 

F.3d 192 (2d Cir. 1999)(Sotomayor, J.)(“When a district court 

enters a final judgment in a case, interlocutory orders rendered 

in the case typically merge with the judgment for purposes of 

appellate review . . . By making interlocutory orders 

unappealable until a final judgment has been entered, these 

rules advance the historic federal policy against piecemeal 

appeals.”)(citations and internal quotation marks omitted); cf.

Richardson-Merrell, Inc. v. Koller, 472 U.S. 424, 430 

(1985)(“Congress has expressed a preference that some erroneous 

trial court rulings go uncorrected until the appeal of a final 

judgment.”).
55

provided under either 28 U.S.C. §§ 158(d)(2) or 1292(b)—routes 

provided for interlocutory appeals. Nevertheless, the debtor's 

case wended its way here under the pretense of an appeal 

pursuant to 28 U.S.C. § 158(d)(1), an appeal of a purportedly 

final order, which it should not be, even under the flexible 

standard of finality applied in bankruptcy.

However, by flexing “flexible finality” in this way, the 

majority effectively reads out the avenues for interlocutory 

relief afforded by bankruptcy’s jurisdictional statutes. 

Moreover, the majority’s rule in this case discourages 

negotiation and mediation in reorganization cases where, 

frankly, those processes are needed. At the same time, the 

majority’s decision encourages start-and-stop appeals, thus 

hampering the aim of judicial economy the majority purports to 

achieve with its ruling. Finally, the majority needlessly 

expands appellate jurisdiction in an area where it has been 

carefully circumscribed. I find no reasonable basis for this 

jurisdictional overreach.

For all these reasons, I dissent, with respect, from the 

decision of the majority.