Jan Hamilton, Chapter 13 Trustee v. Stephanie Kay Lanning (560 U.S. 505)
U.S. Supreme Court · decided June 7, 2010 · Supreme Court Database (Spaeth)
- Citation
- 560 U.S. 505 · 130 S. Ct. 2464
- Decided
- June 7, 2010
- Term
- October Term 2009
- Vote
- 8–1
- Majority author
- Justice Alito
- Issue area
- Economic Activity
- Disposition
- Affirmed
- Outcome
- Petitioning party lost
- Ideological direction
- Liberal
Opinion excerpt
Justice ALITO delivered the opinion of the Court. Chapter 13 of the Bankruptcy Code provides bankruptcy protection to “individuals] with regular income” whose debts fall within statutory limits. 11 U.S.C. §§ 101(30), 109(e). Unlike debtors who file under Chapter 7 and must liquidate their nonexempt assets in order to pay creditors, see §§ 704(a)(1), 726, Chapter 13 debtors are permitted to keep their property, but they must agree to a court-approved plan under which they pay creditors out of their future income, see §§ 1306(b), 1321, 1322(a)(1), 1328(a). A bankruptcy trustee oversees the filing and execution of a Chapter 13 debtor’s plan. § 1322(a)(1); see also 28 U.S.C. § 586(a)(3). Section 1325 of Title 11 specifies circumstances under which a bankruptcy court “shall” and “may not” confirm a plan. § 1325(a), (b). If an unsecured creditor or the bankruptcy trustee objects to confirmation, § 1325(b)(1) requires the debtor either to pay unsecured creditors in full or to pay all “projected disposable income” to be received by the debtor over the duration of the plan. We granted certiorari to decide how a bankruptcy court should calculate a debt- or’s “projected disposable income.” Some lower courts have taken what the parties term the “mechanical approach,” while most have adopted what has been called the “forward-looking approach.” We hold that the “forward-looking approach”…
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