Jay Gehre Putnam

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UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
In re
JAY GEHRE PUTNAM, 	No. 10-14079
Debtor(s).
______________________________________/
Memorandum re Plan Confirmation
_________________
Chapter 11 debtor in possession Jay Putnam is a practicing lawyer. His business premises are
at 523 B Street, Petaluma. The property includes an apartment on an upper floor. When Putnam filed
his Chapter 11 petition on October 22, 2010, he had lived in another property for more than three
years. After the filing, he moved into the apartment. His plan, which modifies the rights of creditor
Chase Home Finance, LLC, secured by the property, is now before the court. The parties have
resolved all issues except whether as a matter of law Putnam can modifiy Chase’s rights.
Section 1123(b)(5) of the Bankruptcy Code allows a debtor to modify the rights of all creditors
except those secured only by the debtor’s principal residence. The property was not Putnam’s
principal residence when he filed his Chapter 11 petition but was at the time his plan came up for
confirmation. The issue is which date controls.
The Bankruptcy Appellate Panel has addressed and resolved the issue by holding that the
petition date is the applicable date. In re Abdelgadir, 455 B.R. 896, 903 (9th Cir. BAP 2011). This
does not mean, of course, that a debtor can move out of his home the day before bankruptcy and then
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Entered on Docket
November 21, 2011
GLORIA L. FRANKLIN, CLERK
U.S BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
Case: 10-14079 Doc# 91 Filed: 11/20/11 Entered: 11/21/11 09:24:29 Page 1 of 2

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modify his home loan; such manipulation and trickery would be evidence of bad faith which might
render a plan unconfirmable pursuant to § 1129(a)(3) of the Code. However, it does mean that if the
property was a bona fide non-residence of the debtor when the bankruptcy petition was filed then the
postpetition use of the property as a principal residence does not prohibit modification of a secured
creditor’s rights.
Putnam having satisfied the court that his plan is proposed in good faith, and all other issues
having been resolved, his amended plan will be confirmed. His counsel shall submit an appropriate
form of order, which counsel for Chase has approved as to form.
Dated: November 20, 2011
SAlan Jaroslovsky
U.S. Bankruptcy Judge
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Case: 10-14079 Doc# 91 Filed: 11/20/11 Entered: 11/21/11 09:24:29 Page 2 of 2