1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

ORDERED PUBLISHED

UNITED STATES BANKRUPTCY APPELLATE PANEL

OF THE NINTH CIRCUIT

In re: ) BAP No. NV-12-1032-DJuKi

)

CHARLENE CHARM FINNEY, ) Bk. No. 11-13330-LBR

)

Debtor. )

______________________________)

)

KATHLEEN A. LEAVITT, )

Chapter 13 Trustee, )

)

Appellant, ) 

)

v. ) O P I N I O N

)

CHARLENE CHARM FINNEY, )

)

Appellee. )

______________________________)

Argued and Submitted on January 25, 2013

at Las Vegas, Nevada

Filed - February 6, 2013

Appeal from the United States Bankruptcy Court

for the District of Nevada

Honorable Linda B. Riegle, Bankruptcy Judge, Presiding

 

Appearances: Sarah E. Smith, Esq., argued for Appellant, Kathleen

A. Leavitt, Chapter 13 Trustee; Christopher P.

Burke, Esq., argued for Appellee, Charlene Charm

Finney.

 

Before: DUNN, JURY, and KIRSCHER, Bankruptcy Judges.

FILED

FEB 06 2013

SUSAN M SPRAUL, CLERK

U.S. BKCY. APP. PANEL

OF THE NINTH CIRCUIT
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

Unless otherwise indicated, all chapter and section 1

references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532.

This case actually is Ms. Finney’s third. An intervening 2

chapter 13 case was filed by Ms. Finney on September 4, 2009 but was

dismissed on January 11, 2011 after Ms. Finney failed to confirm a

plan. 

2

DUNN, Bankruptcy Judge:

This appeal requires that we interpret the Bankruptcy Code to

determine when a chapter 13 debtor is eligible for a discharge 1

where that debtor previously received a chapter 7 discharge in a

case converted from chapter 13.

I. FACTS

The facts in this appeal are straightforward. Charlene Charm

Finney filed a chapter 13 case (“First Case”) on July 25, 2008. 

Approximately eight months later, Ms. Finney sought and obtained a

voluntary conversion of the First Case to a chapter 7 case. 

Ms. Finney was granted a chapter 7 discharge in the First Case on

July 7, 2009.

On March 10, 2011, Ms. Finney filed another chapter 13 case

(“Second Case”). The chapter 13 plan form used in the District of 2

Nevada requires a chapter 13 debtor to indicate whether she is

eligible for a discharge upon completion of all plan obligations. 

Ms. Finney marked her chapter 13 plan form to indicate that she

would be eligible for a discharge. The chapter 13 trustee
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

3

(“Trustee”) objected, asserting that because Ms. Finney had received

a chapter 7 discharge in a case filed within four years of the

filing date of the Second Case, Ms. Finney was not eligible for a

chapter 13 discharge in the Second Case.

The bankruptcy court ruled that Ms. Finney was eligible for a

chapter 13 discharge in the Second Case and confirmed Ms. Finney’s

chapter 13 plan.

The Trustee filed a timely notice of appeal.

II. JURISDICTION

The bankruptcy court had jurisdiction under 28 U.S.C. §§ 1334

and 157(b)(2)(J) and (L). We have jurisdiction under 28 U.S.C.

§ 158.

III. ISSUES

Whether § 1328(f)(1) or (f)(2) contains the applicable “look

back period” for determining Ms. Finney’s eligibility for a

discharge in the Second Case.

IV. STANDARDS OF REVIEW

We review issues of statutory construction and conclusions

of law de novo. Ransom v. MBNA Am. Bank, N.A. (In re Ransom), 380

B.R. 799, 802 (9th Cir. BAP 2007), aff’d 577 F.3d 1026 (9th Cir.

2009), aff’d 131 S. Ct. 716 (2011).

///

///
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

4

V. DISCUSSION

Generally, a chapter 13 debtor who has complied with the

provisions of §§ 1328(a) and (b) is entitled to a discharge of all

debts provided for by the chapter 13 plan or disallowed under § 502. 

Stated very broadly, the debtor need only complete all payments

under the plan and certify that she is current on any existing

domestic support obligations in order to be entitled to a discharge

in chapter 13.

We do not address any of the nuances or exceptions to discharge

under §§ 1328(a) and (b), because the issue on appeal requires only

that we interpret the application of § 1328(f) to Ms. Finney’s right

otherwise to receive a discharge in the Second Case.

“[W]hen the statute’s language is plain, the sole function of

the courts--at least where the disposition required by the text is

not absurd--is to enforce it according to its terms.” Lamie v. U.S.

Trustee, 540 U.S. 526, 534 (2004) (quoting Hartford Underwriters

Ins. Co. v. Union Planters Bank, N.A., 530 U.S. 1, 6 (2000))

(internal quotation marks omitted). However, as stated by one

court, “[§ 1328(f)] is an example of an ambiguity, not an example of

a literal construction leading to an absurd result.” In re Grydzuk,

353 B.R. 564, 567 (Bankr. N.D. Ind. 2006). “Whether a statute is

ambiguous is determined by reference to the language itself, the

specific context in which that language is used, and the broader

context of the statute as a whole.” Hough v. Fry (In re Hough), 239

B.R. 412, 414 (9th Cir. BAP 1999) (quoting Robinson v. Shell Oil

Co., 519 U.S. 337, 341 (1997)) (internal quotation marks omitted). 
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

5

“It is a fundamental canon of statutory construction that the words

of a statute must be read in their context and with a view to their

place in the overall statutory scheme.” Davis v. Mich. Dept. of

Treasury, 489 U.S. 803, 809 (1989).

Applying these principles of statutory construction we turn to

the issue before us.

Section 1328(f) establishes a “look back period” for measuring

when a debtor may receive a discharge in a subsequent bankruptcy

case. Section 1328(f) provides:

Notwithstanding subsections (a) and (b), the court shall

not grant a discharge of all debts provided for in the

plan or disallowed under section 502, if the debtor has

received a discharge–

(1) in a case filed under chapter 7, 11, or 12 of this

title during the 4-year period preceding the date of the

order for relief under this chapter, or

(2) in a case filed under chapter 13 of this title during

the 2-year period preceding the date of such order.

The Trustee asserts that § 1328(f)(1) precludes Ms. Kinney from

obtaining a discharge in the Second Case. The Trustee’s argument is

that § 1328(f) must be read in conjunction with § 348(a).

Section 348(a) provides:

Effect of conversion

(a) Conversion of a case from a case under one chapter of

this title to a case under another chapter of this title

constitutes an order for relief under the chapter to which

the case is converted, but, except as provided in

subsections (b) and (c) of this section, does not effect a

change in the date of the filing of the petition, the

commencement of the case, or the order for relief.

The trustee contends that application of § 348(a) establishes that

the effect of converting the First Case from a chapter 13 case to

chapter 7 is that the First Case is deemed to have been filed under
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

6

chapter 7. In other words, § 348(a) provides that a conversion of a

chapter 13 case to chapter 7 effects an order for relief under

chapter 7 that relates back to the original case filing date. See

In re Michael, 699 F.3d 305, 310 (3d Cir. 2012) (“[W]hen a debtor

converts a Chapter 13 case to Chapter 7, the order converting the

case is effectively backdated to the time of the order for relief

under Chapter 13, which is the date of the filing of the Chapter 13

petition.”); and Resendez v. Lindquist, 691 F.2d 397, 399 (8th Cir.

1982) (“[W]hen there is a conversion, the debtors are deemed to have

filed a Chapter 7 case at the time the Chapter 13 case was filed.”). 

Accordingly, where a bankruptcy case originally filed in chapter 13

is converted to chapter 7, it can be characterized as “filed under”

both chapter 13 and chapter 7, but the discharge is only entered in

the chapter 7 case unless the case later is reconverted to chapter

13.

The vast majority of courts that have considered the issue

support the Trustee’s interpretation of these statutes. See, e.g.,

In re Dalton, 2010 WL 55499 (Bankr. M.D.N.C. 2010) (because

conversion of a case from chapter 13 to chapter 7 constitutes an

order for relief under chapter 7, the prior case will be treated as

“filed under” chapter 7 for purposes of section 1328(f)); In re

Ybarra, 359 B.R. 702 (Bankr. S.D. Ill. 2007) (section 348(a) demands

that a converted chapter 13 case be treated as though it were filed

as a chapter 7 case on its petition date); In re Knighton, 355 B.R.

922, 924-26 (Bankr. M.D. Ga. 2006) (“Section 1328(f) cannot be read

in a vacuum; it must be read in conjunction with § 348(a) . . . .”);
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

7

In re Grydzuk, 353 B.R. 564, 568 (Bankr. N.D. Ind. 2006) (section

348(a) provides that conversion of a chapter 13 case to chapter 7

constitutes an order for relief under chapter 7 such that the case

became “filed under” chapter 7 rather than under chapter 13); McDow

v. Sours (In re Sours), 350 B.R. 261, 268 (Bankr. E.D. Va. 2006)

(extensive case law interpreting section 348(a) makes it clear that

a converted case relates back to the initial filing date for all

purposes, including matters relating to discharge); McDow v. Capers

(In re Capers), 347 B.R. 169, 171-72 (Bankr. D.S.C. 2006) (“Debtor

would have this Court conclude that Congress sought to limit a

debtor’s opportunity to receive a discharge in a subsequent filing

based solely on the chapter under which the previous case was filed,

without regard to the type of discharge the debtor received in the

previous case. This reading of the statute is illogical.”).

Ms. Finney asserts that the Trustee’s reading of the statutes

effectively eliminates the “filed under” language of § 1328(f). 

Only one decision supports Ms. Finney’s position. See In re

Hamilton, 383 B.R. 469 (Bankr. W.D. Ark. 2008). The Hamilton court

compared the language Congress used in creating the “look back

period” in § 1328(f) with the language used in § 727(a)(8) and (9). 

There, Congress directed that the “look back period” for a chapter 7

discharge be measured from the date a prior case was “commenced.” 

Under the Hamilton court’s analysis, (1) § 301(a) provides that “[a]

voluntary case under a chapter of this title is commenced by the

filing with the bankruptcy court of a petition under such chapter by

an entity that may be a debtor under such chapter”; (2) § 348(a)
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

8

explicitly provides that conversion of a case does not effect a

change in the commencement date for the case; and (3) Congress could

easily have stated that the “look back period” set in § 1328(f) is

determined based on the chapter under which a prior discharge was

entered, which it did not do. We do not find the reasoning of the

Hamilton court persuasive.

We agree with the Trustee, who asserts that a literal

application of the words “filed under” to the facts of the case is

contrary to Congress’ intent to create more stringent discharge

rules. As characterized by one court, the legislative history

regarding the purpose of § 1328(f) is “meager.” In re Ybarra, 359

B.R. at 708. Nevertheless, that court relied on the House Report to

the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005,

which stated that the purpose of § 1328(f) is to:

prohibit the issuance of a discharge in a subsequent

chapter 13 case if the debtor received a discharge in a

prior chapter 7, 11, or 12 case within four years

preceding the filing of the subsequent chapter 13 case. 

In addition, it prohibits the issuance of a discharge in a

subsequent chapter 13 case if the debtor received a

discharge in a chapter 13 case filed during the two-year

period preceding the date of the filing of the subsequent

chapter 13 case.

Id. (quoting H.R. Rep. No. 109-31, at 76 (1st Sess. 2005)) (emphasis

added).

Section 348(a) explicitly provides that “[c]onversion of a case

from a case under one chapter of this title to a case under another

chapter of this title constitutes an order for relief under the

chapter to which the case is converted.” As explained by the

Grydzuk court, “upon conversion, the order for relief--the critical
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

If the current case is dismissed, Ms. Finney will be 3

eligible for a discharge in any new chapter 13 case she might file,

since the four-year limitation set forth in § 1328(f)(1) expired

while this appeal was pending.

9

component in the initiation of a bankruptcy case--became ‘an order

for relief under the chapter to which the case was converted,’ i.e.,

Chapter 7. Thus, the case became ‘filed under’ Chapter 7 rather

than under Chapter 13.” Grydzuk, 353 B.R. at 568. Because § 348(a)

effectively converts the First Case to “filed under” chapter 7,

Ms. Finney is not eligible for a chapter 13 discharge in the Second

Case pursuant to § 1328(f)(1).3

VI. CONCLUSION

The bankruptcy court erred when it concluded that Ms. Finney’s

eligibility for a chapter 13 discharge in the Second Case was

governed by § 1328(f)(2) rather than (f)(1). Accordingly, we

REVERSE the order of the bankruptcy court and REMAND for further

proceedings consistent with this disposition.