## Facts

- Martin Wyant filed an individual Chapter 13 bankruptcy case in the United States Bankruptcy Court for the District of Nebraska and submitted a proposed plan for confirmation.
- The Chapter 13 trustee objected to confirmation on the ground that the plan did not satisfy 11 U.S.C. § 1325(b) because it failed to commit all of Wyant’s projected disposable income to plan payments.
- Wyant’s schedules and budget reflected significant ongoing expenditures for the feeding and veterinary care of Wyant’s many elderly horses and dogs.
- The animals were not shown to be necessary to produce income or to be required for Wyant’s employment; the plan effectively treated substantial animal-care costs as ongoing living expenses while providing less for unsecured creditors.
- In addition to the disposable-income dispute, the court addressed how Chapter 13 debtor’s counsel may be compensated, including the need for court approval and the permissible methods of payment.

## Issues

1. Whether, after the trustee’s objection, a Chapter 13 plan can be confirmed under 11 U.S.C. § 1325(b)(1)(B) when the debtor proposes to spend substantial sums on the care of numerous elderly horses and dogs rather than applying that income to payments under the plan.
2. What requirements apply to approval and payment of Chapter 13 debtor’s attorney’s fees, including whether fees may be paid through the plan only after court approval.

## Decision

- The court refused to confirm Wyant’s proposed Chapter 13 plan.
- The court concluded that, once the trustee objected, § 1325(b)(1)(B) required the plan to provide that all projected disposable income would be applied to make payments under the plan, and Wyant’s plan did not meet that requirement.
- The court treated the unusually large animal-care budget, on this record, as not reasonably necessary for the debtor’s maintenance or support for disposable-income purposes; the money allocated to those expenses had to be considered available for plan payments.
- The court ordered Wyant to file an amended plan within 21 days.
- The court also stated that debtor’s counsel may be paid only for fees approved by the bankruptcy court and described the possible outcomes of a fee request (disallowed, allowed and paid from the estate as an administrative expense, or allowed but paid directly by the debtor rather than from the estate).

## Legal Principles

- If the trustee or an unsecured creditor objects, a Chapter 13 plan may be confirmed only if it either pays unsecured claims in full or provides that all of the debtor’s projected disposable income for the applicable period will be applied to payments under the plan. 11 U.S.C. § 1325(b)(1).
- “Disposable income” excludes amounts reasonably necessary for the maintenance or support of the debtor (and dependents, if any); expenses that are discretionary or excessive in relation to basic support may be reclassified as disposable income available to creditors.
- The debtor bears the burden of proposing a confirmable plan once an objection under § 1325(b) is raised, including demonstrating that claimed expenses are reasonably necessary.
- Compensation for Chapter 13 debtor’s counsel is subject to bankruptcy court review and approval; fees may not be paid from estate funds through the plan unless and until approved, and the court may determine whether approved fees are paid from the estate or directly by the debtor.

## Conclusion

In re Wyant denied confirmation of a Chapter 13 plan that diverted significant funds to the feeding and veterinary care of numerous elderly horses and dogs instead of committing projected disposable income to plan payments after the trustee objected under § 1325(b). The court required an amended plan within 21 days and reiterated that Chapter 13 debtor’s attorney’s fees are payable only as approved by the court, with payment method determined through the court’s fee-review process.


In re Wyant, 217 B.R. 585 (1998)