In re Jongsma
| Decision Date | 25 March 2009 |
| Docket Number | No. 07-22012 JPK.,07-22012 JPK. |
| Citation | 402 B.R. 858 |
| Parties | In re Neva Maxine JONGSMA, Debtor. |
| Court | U.S. Bankruptcy Court — Northern District of Indiana |
Kenneth L. Fugate, Esq., Hobart, IN, for the debtor, Neva Maxine Jongsma.
Richard Vawter, Esq., Merrillville, IN, for the creditor, Jennifer Brooker.
On July 31, 2007, the debtor Neva Maxine Jongsma ("Jongsma") filed a Chapter 13 plan. On December 17, 2007, Jennifer Brooker ("Brooker") filed an objection to confirmation of that plan. This objection gives rise to a contested matter subject to the provisions of Fed.R.Bankr.P. 9014. The court has jurisdiction over this contested matter pursuant to 28 U.S.C. § 1334(b), 28 U.S.C. § 157(a) and (b), and N.D.Ind.L.R. 200.1. This matter is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(L).
Jongsma's Chapter 13 case was initiated by a petition filed on July 31, 2007. On that date, she also filed her Chapter 13 plan. Brooker filed her objection to confirmation of Jongsma's plan on December 17, 2007. As stated in docket record entry # 49, at a preliminary pre-trial conference held on February 4, 2008 with respect to Brooker's objection, the attorney for the Chapter 13 Trustee reported that Jongsma's Chapter 13 plan was confirmable upon resolution of the contested matter relating to the objection. An evidentiary hearing was held on June 6, 2008, and the evidentiary record established at that hearing was supplemented by an Agreed Motion to Supplement Record filed by the parties on September 4, 2008; this supplementation was approved by the court.
The parties respectively have filed timely memoranda of law in support of their respective positions.
The court takes judicial notice of the following, pursuant to Fed.R.Evid. 201:
1. Schedules A through J, filed by Jongsma on July 31, 2007;
2. Statement of Financial Affairs filed by Jongsma on July 31, 2007;
3. Chapter 13 Plan filed by Jongsma on July 31, 2007;
4. Amended Schedule A filed by Jongsma on September 18, 2007;
5. Amended Statement of Financial Affairs filed by Jongsma on September 18, 2007;
6. Amended Schedule F filed by Jongsma on October 15, 2007;
7. The docket record in case number 07-22012; and
8. The Claims Register in case number 07-22012, including the claims docketed on that register.
The record before the court is thus the facts established by the June 6, 2008 hearing; the Agreed Motion to Supplement Record; and the materials of which the court has taken judicial notice.
Brooker's objection to confirmation of Jongsma's Chapter 13 plan asserts that the debtor has failed to establish that she has satisfied 11 U.S.C. § 1325(a)(3), 11 U.S.C. § 1325(a)(4), and 11 U.S.C. § 1325(a)(7) with respect to her Chapter 13 plan, and thus that her Chapter 13 plan cannot be confirmed.
In her memorandum in response to Brooker's memorandum, Jongsma contests Brooker's assertions that she has failed to satisfy the confirmation criteria of 11 U.S.C. §§ 1325(a)(3), 1325(a)(4) and 1325(a)(7). In addition, Jongsma contends that because Brooker has not filed a timely claim, Brooker lacks standing to contest confirmation of Jongsma's plan.
The court will address the following issues in the following order in subsequent sections of this Memorandum of Decision:
A. Brooker's standing;
B. Compliance of the plan with 11 U.S.C. § 1325(a)(4);
C. Compliance of the plan with 11 U.S.C. § 1325(a)(3); and
D. Compliance of the plan with 11 U.S.C. § 1325(a)(7).
This Chapter 13 case was initiated by a petition filed on July 31, 2007. On that date, Jongsma filed her initial Schedules and Statement of Financial Affairs. Schedule A disclosed that Jongsma had interests as a tenant by the entireties in property located at 3241 Atlanta Boulevard, Portage, Indiana. Schedule I included in the debtor's income the amount of $900.00, stated to be derived from "Income from Real Property". In line 13 of Schedule J, Jongsma included the amount of $865.00 as "rental property mortgage 5445 Independence" and "rental property 2691 Gibson" in the amount of $460.00. Schedule F designated "Jennifer & Clifford Brooker" as creditors; the nature of the indebtedness owed to them was described as "Partnership liability" in an amount designated as "Unknown". Schedule H designated Jennifer Brooker as a co-debtor. Section 10 of the Statement of Financial Affairs designated two transfers within the definition of that section, one to Kent Heating and one to J & S Services.
Amended Schedule A, filed on September 18, 2007, added two property interests to that stated in the original Schedule A: a time share in Club Regina in Cancun, Mexico, stated to be held by Jongsma as a joint tenant, with a stated value of $3,000.00; and a time share in DeSarrollo Marina Villarta in Acapulco, Mexico, stated to be held as a joint tenant with a designated value of $4,000.00. The Amended Statement of Financial Affairs — also filed on September 18, 2007 — amended section 10 to include in designated transfers, properties located at 5445-47 Independence Avenue, Portage, Indiana and 2691 Gibson Street, Lake Station, Indiana, as transferred to Ken Jongsma in March of 2007. The following statement was included in section 10:
Properties were transferred so that a loan could be received in husband's name for repairs to the properties. Debtor did not qualify for the loan due to bad credit. Debtor received no value for the transfer.
Schedule C, as originally filed on the date of filing of the petition, has never been amended. That schedule, as originally filed, claims an exemption pursuant to I.C. § 34-55-10-2(c)(1) in the amount of $15,000.00 with respect to real property located at 3241 Atlanta Boulevard, Portage, Indiana. No exemption has ever been claimed by Jongsma with respect to the time share interests stated in Amended Schedule A, nor with respect to any other interests Jongsma may have held on the date of filing of the petition in other real property.
The Agreed Motion to Supplement Record filed by the parties on September 4, 2008 establishes that the property located at 5445/5447 Independence, Portage, Indiana was originally deeded to Neva M. Jongsma and Kenneth J. Jongsma, as tenants by the entireties; that a mortgage with respect to this property was effected by Neva M. Jongsma and Kenneth J. Jongsma, as mortgagors; that the underlying obligation which the foregoing mortgage secures is solely that of Kenneth J. Jongsma; and that Neva M. Jongsma and Kenneth J. Jongsma refinanced that property and received net proceeds from the refinancing of approximately $42,000.00. The Agreed Motion also establishes that the property located at 2691 Gibson Street, Lake Station, Indiana, was originally deeded to Neva M. Jongsma and Kenneth J. Jongsma; that a mortgage on that property was effected by Neva M. Jongsma and Kenneth J. Jongsma; that the obligation secured by the foregoing mortgage is solely that of Kenneth J. Jongsma; and that Neva M. Jongsma and Kenneth J. Jongsma received net proceeds from a refinancing of $22,400.00 with respect to that property. No Schedule A filed by Jongsma in this case reflects her ownership interests in the properties located at 5445/5447 Independence, Portage, Indiana and 2691 Gibson Street, Lake Station, Indiana. Section 10 of the Amended Statement of Financial Affairs erroneously states that transfers of properties located at 5445/5447 Independence Avenue, Portage, Indiana and at 2691 Gibson Street, Lake Station, Indiana were made to Ken Jongsma. As made clear by the Agreed Motion to Supplement Record, no transfer of any interests in those properties was ever made to Ken Jongsma; rather, transfers of interests in those properties "as security" were made within the two years immediately preceding the filing of the petition initiating this Chapter 13 case by Neva Jongsma to Countrywide Mortgage and to GMAC Mortgage, with respect to the mortgages provided to those respective creditors as part of refinancings with respect to both of those properties.
Both the original Schedule F and the Amended Schedule F filed by Jongsma fail to specifically delineate by whom the debts listed in those schedules are owed.1
The claims register discloses two joint debts, based upon the documentation provided by the claim filing creditors in support of their claims: GMAC, which filed claim # 1 in the amount of $23,234.39 as a secured claim; and Chase Bank USA, N.A., which filed claim # 2 in the amount of $329.85.2
At the evidentiary hearing held on June 6, 2008, the testimony of Jongsma established that her bankruptcy attorney, Kenneth Fugate, personally discussed the information stated in the original Schedules and Statement of Financial Affairs with Jongsma, and that Jongsma personally reviewed those documents and signed them under the penalties of perjury as being correct. With respect to the properties located at 5445/5447 Independence, Portage, Indiana and at 2691 Gibson Street, Lake Station, Indiana, Jongsma testified that it was her understanding that the properties had been taken out of her name as a part of the refinancing transactions relating to those properties because of the impairment of her credit as a result of a failed business venture. Thus, it was her testimony at the June 6, 2008 hearing that she believed in good faith that she no longer held an ownership interest in these properties at the time of the filing of her Chapter 13 case. In response to the following question by her counsel at the hearing: "Why did you tell me no [that there had been no transfers with respect to these properties] when there was actually a transfer", Jongsma's response was:
I was — when you asked me a transfer, I was thinking that you were asking me if I took anything...
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In re Shelton, Case No. 17bk35941
...burden of proof is upon the debtors, as the plan proponents, to prove all of the elements of a confirmable plan."); In re Jongsma , 402 B.R. 858, 871 (Bankr. N.D. Ind. 2009) ("[T]he debtor bears the ultimate burden of proof as to satisfaction of the confirmation criteria of 11 U.S.C. § 1325......
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Manning v. Watkins (In re Watkins)
...the case, the court is left with the impression that the debtor sought to thwart creditors, trustees or the court; see, In re Jongsma, 402 B.R. 858 (Bankr. D.Ind. 2009). Thus, the court's approach to litigated § 727(a) cases - in terms of applying the sometimes relatively strict and harsh c......
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Manning v. Watkins (In re Watkins)
...to the case, the court is left with the impression that the debtor sought to thwart creditors, trustees or the court; see, In re Jongsma, 402 B.R. 858 (Bankr.D.Ind.2009). Thus, the court's approach to litigated § 727(a) cases—in terms of applying the sometimes relatively strict and harsh cr......
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In re Rodriguez
...conduct is irrelevant to the determination of whether a debtor filed a Chapter 13 plan in good faith. See, In re Jongsma, 402 B.R. 858, 870 (Bankr.N.D.Ind.2009)(stating that “pre-petition conduct of the debtor is now irrelevant to the determination of good faith under 11 U.S.C. § 1325(a)(3)......