No. 13-00-12058 SRUnited States Bankruptcy Court, D. New Mexico
March 18, 2002
ORDER DENYING MOTION FOR PAYMENT OF SUPPORT PRIORITY UPON DISMISSAL OR CONVERSION
JAMES S. STARZYNSKI, United States Bankruptcy Judge.
This matter is before the Court on the Motion of Creditor Rita Jawort for Payment of Support Priority Upon Dismissal or Conversion (doc. 112), and the Memorandum in support thereof (doc. 124). The Court finds that the Motion should be denied. On February 22, 2001 the Court issued oral findings of fact, conclusions of law and judgment on the priority status of Rita Jawort’s claim after trial on the merits. The Court ruled that Ms. Jawort’s claim was entitled to priority status under 11 U.S.C. § 507(a)(7). Debtor appealed to the Bankruptcy Appellate Panel for the Tenth Circuit, which affirmed by Mandate dated July 31, 2001. In her Motion for Payment of Support Priority Upon Dismissal or Conversion, Ms. Jawort seeks an order, in the event of conversion or dismissal, directing the Chapter 13 Trustee to pay funds on hand to her in partial satisfaction of her priority claim.
Bankruptcy Code Section 1326(a)(2) provides, in part:
If a plan is not confirmed, the trustee shall return any such payment to the debtor, after deducting any unpaid claim allowed under section 503(b) of this title.
11 U.S.C. § 1326(a)(2). Section 503 of the Code deals with administrative expenses.
Ms. Jawort claims that she has made a “substantial contribution” to the case. “To be compensable under section 503( b)(3)(D), post-petition efforts must result in an actual and demonstrable benefit to the bankruptcy estate.” Haskins v. United States (In re Lister), 846 F.2d 55, 57 (10th Cir. 1988). Only reorganization efforts directly benefitting the estate qualify. Id. A creditor protecting its own interests that only incidentally or minimally benefits the estate does not make the requisite “substantial contribution.” Id. at 58.
Furthermore, the Court questions whether merely defeating a plan and getting a case dismissed can ever be a “substantial contribution” within section 503(b).
Ms. Jawort has a priority claim, not an administrative claim. Section 1326(a)(2) therefore does not apply to Ms. Jawort’s claim, and her motion should be denied.
IT IS ORDERED that the Motion for Payment of Support Priority Upon Conversion or Dismissal is denied.
I hereby certify that on March 15, 2002, a true and correct copy of the foregoing was either electronically transmitted, faxed, delivered, or mailed to the listed counsel and parties.