## Facts

- Alfreda Epps Leavell filed a Chapter 13 petition on December 8, 1994 and proposed a plan requiring $75 per month for 36 months based on monthly earnings of about $1,550.
- The bankruptcy court confirmed the plan on February 6, 1995; the confirmation order provided that all property of the estate revested in the debtor upon confirmation.
- Six days after filing, Leavell purchased a ring and a video cassette recorder from Littmans, Inc. and did not disclose her bankruptcy.
- Leavell did not pay for the postpetition purchases; Littmans, through counsel W. Wayne Tiffany, sued her in state court and obtained a judgment on July 19, 1995.
- Littmans began garnishing Leavell’s wages to satisfy the judgment.
- After debtor’s counsel notified Tiffany of the Chapter 13 case and requested dismissal of the garnishment, the request was refused.
- Leavell moved for contempt and sanctions, seeking damages and attorney’s fees on the theory that the wage garnishment violated the automatic stay.
- Littmans did not file a proof of claim for the postpetition debt, and the confirmed plan did not provide for it.
- Leavell did not contend that the state-court lawsuit or judgment violated the stay; the motion challenged only the garnishment.

## Issues

1. Whether a creditor violates the automatic stay by garnishing a Chapter 13 debtor’s postconfirmation wages to collect a postpetition debt when the confirmed plan provides that all estate property revests in the debtor and does not provide for the postpetition claim.

## Decision

- The court denied the debtor’s motion for contempt and sanctions.
- The court held that the wage garnishment to collect Littmans’ postpetition debt did not violate the automatic stay under the circumstances.
- Because there was no stay violation, there was no basis for contempt, damages, attorney’s fees, or sanctions.

## Legal Principles

- The automatic stay generally bars: (1) actions against the debtor that could have been brought before the petition date; (2) actions against the debtor’s property to collect prepetition debts; and (3) acts to obtain or control property of the estate, even if the underlying debt arose postpetition.
- A suit or collection effort on a purely postpetition claim is not stayed under the debtor-protection prong of § 362(a)(1) because it is not an action that could have been brought prepetition.
- When a confirmed Chapter 13 plan (or confirmation order) provides that all property of the estate revests in the debtor upon confirmation, postconfirmation earnings targeted by a creditor may not be treated as “property of the estate” for purposes of applying § 362(a)(3) in that setting.
- Absent a stay violation, contempt and sanctions are unavailable.

## Conclusion

The court refused to sanction a postpetition creditor for garnishing a Chapter 13 debtor’s postconfirmation wages, concluding the automatic stay did not bar collection of an unprovided-for postpetition debt after confirmation where the plan revested all estate property in the debtor.


In re Leavell, 190 B.R. 536 (Bankr. E.D. Va. 1995)