Earthamae Isaac

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF COLUMBIA
In re
EARTHAMAE ISAAC,
Debtor.
)
)
)
)
)
Case No. 06-00172
(Chapter 7)
DECISION RE CONVERTING CASE TO CHAPTER 13
The chapter 7 trustee has opposed the debtor's motion to
convert this case to chapter 13. The court heard the motion on
December 11, 2006, and issued an oral decision granting the
motion, subject to the case being re-converted to chapter 7
should the debtor's mortgagee obtain relief from the automatic
stay.
The debtor has asserted that if this case is converted to
chapter 13, she will be able in a chapter 13 case to address both
the prepetition and postpetition/preconversion arrears owed her
mortgagee. The debtor pointed to 11 U.S.C. § 348(d) as one basis
for her being allowed as a matter of law to treat
postpetition/preconverson arrears as part of the arrears to be
cured under a plan. Section 348(d) provides for
The decision below is hereby signed. Dated:
December 11, 2006.
_____________________________
S. Martin Teel, Jr.
United States Bankruptcy Judge
Case 06-00172 Doc 71 Filed 12/12/06 Entered 12/12/06 14:03:57 Desc Main
Document Page 1 of 3

2
postpetition/preconversion claims to be treated as prepetition
claims upon a conversion pursuant to 11 U.S.C. §§ 1112, 1208, or
1307, but § 348(d) does not apply to a conversion of a case from
chapter 7 to chapter 13.
The debtor alternatively stated that the mortgagee could
elect to have the postpetition/preconversion mortgage arrears
provided for by a plan. If that occurs, and the debtor carries
out her intention to rent out her larger spare room for $1,000
per month, a chapter 13 plan addressing those and the prepetition
arrears would be feasible for reasons detailed by the court in
its oral decision at the hearing of December 11, 2006. The court
cannot say that the debtor is proceeding in bad faith in seeking
to convert to chapter 13 to make that attempt.
There is no guarantee that the mortgagee would consent to
such treatment, and, if it does not, it is likely the court would
hold, in the context of the mortgagee's pending motion for relief
from the automatic stay, that the postpetition/preconversion
arrears may not be cured via her chapter 13 plan. It appears
unlikely that the debtor could cure her postpetition mortgage
arrears pursuant to the typical chapter 13 order conditioning the
automatic stay that the court enters to address postpetition
defaults on a debtor's home mortgage. Pursuant to that type of
order, the debtor is granted only a brief period to bring her
postpetition home mortgage defaults current, and not the usual 36
Case 06-00172 Doc 71 Filed 12/12/06 Entered 12/12/06 14:03:57 Desc Main
Document Page 2 of 3

3	O:\Judge Temp Docs\Isaac (Earthamae) Decision re Converting Case to Chapter 13.wpd
or more months that a chapter 13 plan would entail.
Should the court grant the motion for relief from the
automatic stay because the mortgagee will not consent to having
the debtor cure postpetition defaults under a chapter 13 plan,
and because the debtor is unable to bring the postpetition
defaults current within a short period of time, then the
interests of unsecured creditors and administrative claimants
would dictate that this case be re-converted to chapter 7. The
court will convert the case to chapter 13, but should the court
grant relief from the automatic stay in favor of the debtor's
mortgagee, the court will, without the necessity of further
motion, immediately re-convert this case to chapter 7 in order
that the chapter 7 trustee may continue his efforts to sell the
debtor's real property for the benefit of unsecured creditors and
administrative claimants.
An order follows.
[Signed and dated above.]
Copies to: Debtor; Debtor's Attorney; all entities on BNC mailing
list; Cynthia A. Niklas; Office of U.S. Trustee.
Case 06-00172 Doc 71 Filed 12/12/06 Entered 12/12/06 14:03:57 Desc Main
Document Page 3 of 3