Unpublished Disposition, 919 F.2d 145 (9th Cir. 1990)

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US Court of Appeals for the Ninth Circuit - 919 F.2d 145 (9th Cir. 1990)

In re Ben PORTER, Suzan Porter, Debtors.WASHINGTON STUDENT LOAN GUARANTY ASSOCIATION, Appellant,v.Ben PORTER, Suzan Porter, Appellees.

No. 89-35701.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted June 4, 1990.Submission Deferred June 28, 1990.Resubmitted Aug. 23, 1990.Decided Nov. 26, 1990.



Washington Student Loan Guaranty Association ("WSLGA") appeals from the Bankruptcy Appellate Panel's ("BAP") decision affirming a bankruptcy judge's confirmation of Ben and Suzan Porter's Chapter 13 repayment plan. WSLGA contends that the BAP erred in affirming the bankruptcy judge's findings that (1) the Porter's Chapter 13 plan was "proposed in good faith" pursuant to 11 U.S.C. § 1325(a) (3), and (2) no "cause" existed to condition confirmation of the Porters' Chapter 13 plan on the extension of the plan from three to five years pursuant to 11 U.S.C. § 1322(c).1  We have jurisdiction pursuant to 28 U.S.C. § 158(d) and affirm.

Under the "totality of circumstances" test, the bankruptcy judge's finding that the Porters' plan was proposed in "good faith" was not clearly erroneous even though a large portion of the Porters' unsecured debt consists of student loan obligations, which would be nondischargeable in a Chapter 7 proceeding. See generally Goeb v. Heid (In re Goeb), 675 F.2d 1386, 1389-91 (9th Cir. 1982); In re Metz, 820 F.2d 1495, 1497 (9th Cir. 1987); see also In re Warren, 89 Bankr. 87, 92-93 (Bankr. 9th Cir. 1988) (listing relevant factors in the "good faith" determination).

Furthermore, while the duration of a plan may be a relevant factor in the "good faith" inquiry, Congress's intent to limit the repayment period favors a policy limiting "cause" for an extension beyond the three-year period to situations where the debtor requests the extension and benefits from it. See, e.g., In re Karayan, 82 Bankr. 541, 542-44 (Bankr.C.D. Cal. 1988); see also H.R.Rep. No. 595, 95th Cong., 1st Sess. 117 (1977), reprinted in 1978 U.S.Code Cong. & Admin. News 5786, 6078 (legislative history indicates that Congress's decision to adopt a three-year period was based on its concern that extended bankruptcy repayment plans had "become the closest thing there is to involuntary servitude"); 5 Collier on Bankruptcy p 1322.15 at 1322-36 (15th ed. 1986) (extensions beyond three years should not be imposed involuntarily on the debtor; to do otherwise would be contrary to section 1325(b) and to Congress's intent).



This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir.R. 36-3


On appeal WSLGA also argued that the BAP's decision should be vacated and the case remanded because the bankruptcy judge failed to make specific findings of fact and conclusions of law as required by Bankruptcy Rule 7052. On June 8, 1990, however, we remanded the case to the bankruptcy judge to make specific findings but retained jurisdiction over this appeal. We now have those findings before us and hold that they are adequate to satisfy Bankruptcy Rule 7052