In re Simmons, Case No. 05-92328, 2006 Bankr. LEXIS 1527 (Bankr. N.D. Ga. June 8, 2006).

Debtor filed a Chapter 7 case in May 2005.  After two changes of lawyers, Debtor filed a motion to convert to Chapter 13 in June 2005, ostensibly to protect significant non-exempt assets.  The court gave the debtor the opportunity to file a plan and the required schedule and another hearing was held in September 2005.  After another change of counsel, and extensions of time, the court ultimately granted the motion to convert in December 2005.  For the next several months, the debtor was given the opportunity to propose a confirmable plan and confirmation hearings were scheduled and rescheduled.  Throughout the case, the secured lender had sought relief from the stay to foreclose on the debtor’s residence. 

Ultimately, the debtor did not propose a confirmable plan and the Chapter 13 trustee filed a motion to reconvert to Chapter 7 on the grounds that the debtor was behind on plan payments, had not submitted tax returns, and because creditors would receive less than they would if the case were a Chapter 7 case.  The secured lender also reported a post-petition arrearage in excess of $8,000 and objected to the confirmation of the debtor’s plan.

Debtor argued that he should be granted further extensions to propose an amended plan based upon the upcoming bar date and the fact that he had objected to a claim. The court granted further extension and scheduled a hearing for May 9, 2006. In the interim, the debtor was required to make payments to the secured lender and the Chapter 13 trustee. At the May 9 hearing, the debtor was still delinquent on plan payments and both the trustee and secured lender support converting back to Chapter 7.

The court converted the case back to Chapter 7.  The debtor had sufficient assets to pay much of the unsecured creditors if they were liquidated and the debtor had more than a year to propose a confirmable plan.  Debtor’s counsel’s argument that they should be allowed to wait until the bar date and resolution of claims objections to file a plan had no merit, as the Code requires that plans be filed within 15 days of the petition date and a confirmation hearing be held soon thereafter.