Roger Thomas Williamson and Lisa Philpott Williamson

UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF NORTH CAROLINA
RALEIGH DIVISION
IN RE:
ROGER THOMAS WILLIAMSON and
LISA PHILPOTT WILLIAMSON,
DEBTORS.
CASE NO.
09-04809-8-JRL
ORDER
The matters before the court are the motion by the debtors, Roger Thomas Williamson and
Lisa Philpott Williamson, to allow the debtors to make plan payments directly to the chapter 13
trustee and the motion by the chapter 13 trustee, John Logan, to dismiss the case. A hearing was
held in Raleigh, North Carolina on September 15, 2009.
Roger Thomas Williamson and Lisa Philpott Williamson filed a petition for relief under
chapter 13 of the Bankruptcy Code on June 10, 2009. At the meeting of creditors held on June 11,
the trustee informed the debtors that he would require their chapter 13 plan to be funded by payroll
deduction and that if the debtors were opposed to payroll deduction then they would need to file a
motion requesting permission to make direct payments into their chapter 13 plan. The debtors filed
SO ORDERED.
SIGNED this 02 day of October, 2009.
________________________________________
J. Rich Leonard
United States Bankruptcy Judge
____________________________________________________________
Case 09-04809-8-SWH Doc 23 Filed 10/02/09 Entered 10/02/09 15:13:29 Page 1 of 4

2
their motion to permit direct payments into their plan on July 31, 2009, and the trustee filed an objection.
At the hearing, the female debtor, Ms. Williamson, testified that she does not want to put her
employer on notice of her bankruptcy by a wage order for payroll deduction from the chapter 13
trustee. Ms. Williamson cited several reasons she felt that her continued employment was at risk:
she has only been at her present job for one year and four months; she has a history of medical
problems; and she is an older employee. Ms. Williamson testified that this bankruptcy filing could
be the final straw that would lead to her being fired. In addition, Ms. Williamson, while admitting
she could not prove a causal connection, testified that a fellow employee had been fired shortly after
filing for bankruptcy.
The trustee contends that the Williamsons should be required to pay into their plan using
payroll deduction. The trustee stated that debtors enrolled in payroll deduction are more likely to
successfully complete their plans, and this case specifically has factors that suggest that payroll
deduction should be required. The trustee points out that this is Ms. Williamson's fifth bankruptcy
case and a couple of the previous cases were dismissed for lack of payments. In addition, there is
a large pool of money scheduled to be paid to the unsecured creditors and the mortgage is to be paid
through the plan. 	In addressing Ms. Williamson's concern about her employer learning of the
bankruptcy filing and then as a consequence losing her job, the trustee stated that filing for
bankruptcy is a matter of public record and, therefore, any privacy concerns expressed by the debtors
are not reasonable.
The Bankruptcy Code states that the debtor's plan must "provide for the submission of all
or such portion of future earnings or other future income of the debtor to the supervision and control
of the trustee as is necessary for the execution of the plan." 11 U.S.C. § 1322(a)(1). The debtor may
Case 09-04809-8-SWH Doc 23 Filed 10/02/09 Entered 10/02/09 15:13:29 Page 2 of 4

3
propose the plan, but this court has generally left the decision of whether a debtor should be required
to pay into their plan through payroll deduction to the chapter 13 trustee. Where, as here, the trustee
insists that the debtors be required to use payroll deduction to fund their plan and the debtors are
opposed to the use of payroll deduction, the court is the final arbiter of whether or not payroll
deduction should be required.
This court has always been supportive of the use of payroll deductions and the court agrees
with the trustee that a debtor's plan has a greater statistical chance of success if payroll deduction
is used to fund the chapter 13 plan. The Bankruptcy Code, however, does not mandate the debtor
use a specific method of payment into their plan. While there may be situations where a debtor may
be required to use payroll deduction in order for their plan to be confirmed, the debtors in the present
case have demonstrated circumstances that have convinced the court that they should not be
mandated to use payroll deduction to fund their plan. Specifically, Ms. Williamson's belief that she
will lose her job if payroll deduction is utilized, whether or not accurate, is genuine, as she has
requested dismissal of the case if payroll deduction is mandated. On these facts, the court will allow
the debtors' to make direct payments to the trustee.
The second matter before the court is the trustee's motion to dismiss. The trustee asserts that
the debtors' case should be dismissed because three deductions taken by the debtors on Form B22C
were improper: (1) a deduction for life insurance, (2) a deduction for an alarm system, and (3) a
deduction for care of a physically or mentally challenged child. The trustee argues that the debtors'
plan cannot be confirmed because, absent these improper deductions, the debtors would have
additional monthly disposable income that would be paid to unsecured creditors through the plan
as is required by 11 U.S.C. § 1325(b). The debtors contend that their deductions are proper.
Case 09-04809-8-SWH Doc 23 Filed 10/02/09 Entered 10/02/09 15:13:29 Page 3 of 4

4
At the hearing, the debtors were able to sufficiently demonstrate and document that the
deductions for life insurance and the alarm system were proper. As to the deduction for care of a
physically or mentally challenged child, this deduction is listed on the same line as necessary
expenses for education that is a condition of employment, and it is for this latter purpose that a
deduction was properly taken by the debtors on this line. Accordingly, the debtors have adequately
completed the means test form (Form B22C) and the trustee's motion to dismiss will be denied.
Based on the foregoing, the debtors' motion to allow direct payment into their chapter 13
plan is ALLOWED and the trustee's motion to dismiss is DENIED.
END OF DOCUMENT
Case 09-04809-8-SWH Doc 23 Filed 10/02/09 Entered 10/02/09 15:13:29 Page 4 of 4