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ARTICLE · 13 JANUARY 2011

Supreme Court Decision Alert - January 11, 2011

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Chapter 13 of the Bankruptcy Code allows an individual debtor to propose a plan for repaying creditors out of the debtor’s "projected disposable income."

United StatesLitigation, Mediation & Arbitration
Andrew Tauber
Andrew Tauber
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Originally published January 11, 2011

Keywords: Bankruptcy Code, appellate, projected disposable income, debtor, creditor, Ransom v. FIA Card Services,

Today the Supreme Court issued a decision, described below, of interest to the business community.

  • Chapter 13 Bankruptcy—"Projected Disposable Income"

Chapter 13 Bankruptcy—"Projected Disposable Income"

Ransom v. FIA Card Services, N.A., No. 09-907 (previously discussed in the April 19, 2010 Docket Report)

Chapter 13 of the Bankruptcy Code allows an individual debtor to propose a plan for repaying creditors out of the debtor's "projected disposable income." If a creditor objects, the bankruptcy court may confirm the plan only if it provides for all of the debtor's projected disposable income to go toward paying off debt. 11 U.S.C. § 1325(b)(1)(B). Today, in Ransom v. FIA Card Services, N.A., No. 09-907, the Supreme Court clarified the method for calculating disposable income under Chapter 13,

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