Court Opinion

ID: 9697964
Source: CourtListenerOpinion
Date Created: 2023-08-25 19:38:17.904746+00
Date Added: 2024-06-11T18:20:37.417697
License: Public Domain

YOLINN, Bankruptcy Judge,
amended concurrence:
I concur with the basic reasoning and result of the majority which concludes that the trial court correctly granted the trustee’s motion for modification of the debtor’s previously confirmed plan. The motion was granted by the trial court on the basis of its finding that following confirmation there was a substantial increase in the debtor’s income which was not foreseeable at the time of confirmation.
I am constrained to state, however, that the majority’s commentary on the issue of whether the trustee can make a motion for modification where there has not been a substantial change is unwarranted. There are divergent views on this issue among the circuits as noted in In re Witkowski, 16 F.3d 739, 743 (7th Cir.1994) which was cited with approval by the majority. Witkowski rejects In re Arnold, which it cites as a leading case among a number of bankruptcy court opinions which have required an “unanticipated substantial change in financial circumstance” to support a motion for modification. See In re Arnold, 869 F.2d 240, 241 (4th Cir.1989) (“it is well-settled that a substantial change in the debtor’s financial condition after confirmation may warrant a change in the level of payments”).
Had the trial court found that there was no change, a discussion involving the issue of the need to show substantial change would be warranted. Such is not the case. The fact that there was a change is undisputed. Nevertheless, the majority proceeded to discuss the issue as if there were no change, stating “we conclude that the better reasoned approach is that expressed in Witkowski As such, we decline to hold that the change must be substantial and unanticipated as suggested by various cases in this circuit.”
There are cases in this circuit which run contrary to Witkowski In In re Anderson, the Ninth Circuit Court of Appeals stated:
Under § 1329, the trustee may request modification of the debtor’s plan. If the debtor or a creditor objects to the modification, the trustee “must bear the burden of showing a substantial change in the debtor’s ability to pay since the confirmation hearing and that the prospect of change had not already been taken into account at the time of confirmation.”
Anderson, 21 F.3d 355, 358 (9th Cir.1995) (citations omitted). See also In re Heath, 182 B.R. 557, 561 (9th Cir. BAP 1995) (stating that a trustee is free to seek modification after confirmation if circumstances so warrant, in which event “the trustee bears the burden of showing a substantial change in the debtor’s ability to pay since the confirmation hearing and that the prospect of the change had not already been taken into account at the time of confirmation”) (citing *624Anderson, 21 F.3d at 358). The language of both of these eases was dieta, and, therefore, not binding. However, an appellate court treats dicta from a superior court with due deference. See United States v. Baird, 85 F.3d 450, 453 (9th Cir.1996), petition for cert, filed. I see no reason here to determine that the Ninth Circuit Court of Appeals or the BAP was in error.
In summary, the debtor conceded and the court found that her circumstances had changed. I believe that it is therefore gratuitous to discuss the issue of substantial change, particularly in the light of the indicated divergent views which include appellate authority in the Ninth Circuit.