In re Gardner, 81-1120.
| Decision Date | 28 September 1982 |
| Docket Number | No. 81-1120.,81-1120. |
| Parties | In re William L. GARDNER and Janice M. Gardner, Debtors. GENERAL MOTORS ACCEPTANCE CORPORATION, Plaintiff-Appellant, v. William L. GARDNER and Janice M. Gardner, Defendants-Appellees. |
| Court | U.S. District Court — Western District of Arkansas |
Randolph B. Hopkins, Barber, McCaskill, Amsler, Jones & Hale, Little Rock, Ark., for plaintiff-appellant.
Robert E. Adcock, El Dorado, Ark., for defendants-appellees.
The appellant, General Motors Acceptance Corporation (GMAC), brings this appeal to this Court from a ruling of the Bankruptcy Court for the Western District of Arkansas, El Dorado Division1, that requires GMAC to turn over to the debtors, William L. and Janice M. Gardner (debtors), a 1980 Pontiac Grand Prix automobile. The parties having filed the record of the Bankruptcy Court's proceeding in this Court, and having filed a brief on the issues in this case, the Court is now ready to make a determination of this appeal.
The Court has jurisdiction of this bankruptcy appeal pursuant to 28 U.S.C. § 1334, which gives the District Court appellate jurisdiction of final decisions of Bankruptcy Courts in its district.
The automobile in question in this case was brought from George Morgan Motors, Inc. of El Dorado, Arkansas, under a retail sales installment contract. The appellant GMAC was assigned the contract. The date of the purchase of the automobile was August 20, 1980. The last payment that GMAC received under the contract was in February, 1981.
On March 4, 1981, the debtors filed their first Chapter 13 petition with the Bankruptcy Court. The plan that the debtors filed with the Bankruptcy Court for its approval, and the bankruptcy case of the debtors, was dismissed by the Bankruptcy Court on July 16, 1981 for lack of feasibility.
For two weeks, the debtors took no action. The appellant GMAC then took action by repossessing the automobile on July 31, 1981. On that same day the debtors filed in the Bankruptcy Court a second Chapter 13 petition, No. ED 81-43. On August 5, 1981 the debtors instituted an adversary proceeding against GMAC and the selling dealer for the turn over of the automobile. GMAC and the selling dealer filed an answer and a counter-claim against the debtors for relief from the automatic stay so that they could proceed to sell the automobile. GMAC also asked that the petition of the debtors' be dismissed on the grounds of lack of feasibility of the plan. GMAC also asked that the petition be dismissed due to the plan being filed with a lack of good faith.
In the second petition, the income for Mr. Gardner was listed at $232.16 per month. Mrs. Gardner's income was listed at $550.20 per month. The total combined monthly income, including income from other sources, was listed at $1,626.36 per month. The total monthly expenses and the plan payments was listed at $1,491.17 per month. The debtors had a surplus of $135.19 per month.
At the hearing it was determined that the debtor William Gardner was at the time of the hearing drawing unemployment benefits which had been declared as part of his income. He also worked at ENSCO from 8 to 24 hours a week at a rate of $3.90 per hour. The wage would reduce the amount that Mr. Gardner would receive in unemployment benefits. Mr. Gardner also receives $340.00 per month for being pastor at two different churches in the area. The unemployment benefits were to run out in December, 1981. Mrs. Gardner was bringing home about $275.10 on a semi-monthly basis.
Mr. Gardner stated at the hearing that he had a verbal promise for a teaching position in the Strong Public School System. Mr. Gardner also interviewed for other jobs outside of the area.
The plan of the debtors' offered to pay debts in the amount of $17,022.75 over a period of three years at a monthly rate of $520.14 per month. On September 1, 1981, a hearing was held on the petition of the debtors' to compel the turn over of the automobile and also to hear the objections of GMAC against the confirmance of the plan of the debtors' and for the lifting of the automatic stay. The Bankruptcy Court denied GMAC in its claim seeking relief from the automatic stay, allowed the debtors to regain possession of the automobile, and confirmed the plan of the debtors'.
The issue that this Court has to determine in this case is whether the Bankruptcy Court, in the hearing on the matter before this Court, was correct in its factual determination that the income of the debtor and the payments to be made under the plan was feasible. This is a factual determination in that the Bankruptcy Court had to decide from the evidence before it whether the debtors were capable of making payments under the plan, whether the plan was filed in good faith, and whether GMAC was adequately protected in its claim against the debtors and whether the automatic stay would remain in effect.
The determination of the Bankruptcy Court as to the feasibility of the plan is a factual determination that it makes. Rule 810 of the Rules of Bankruptcy Procedure states:
Previous cases that have cited this statute and the standard set forth have decided that the one who contests the finding of fact had the burden of proof of showing that the judge's finding of fact was "clearly erroneous." A mere showing that the Bankruptcy Court could have decided one way or another based...
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