Lineberger v. Henry

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 05-1294
In Re: DELORIS JEAN HENRY,
Debtor.
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FRANK JAMES LINEBERGER,
Appellant,
versus
DELORIS JEAN HENRY,
Appellee.
Appeal from the United States District Court for the Western
District of North Carolina, at Charlotte. Graham C. Mullen, Chief
District Judge. (CA-03-367-3; BK-03-31155)
Submitted: August 26, 2005 Decided: October 28, 2005
Before NIEMEYER, MOTZ, and TRAXLER, Circuit Judges.
Vacated and remanded by unpublished per curiam opinion.
Frank James Lineberger, Appellant Pro Se. Terry Michael Duncan,
Charlotte, North Carolina, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:
Frank James Lineberger appeals from the district court’s
order affirming the bankruptcy court’s orders denying his motion
for relief from the automatic stay in Deloris Henry’s bankruptcy
case, 11 U.S.C. § 362(a) (2000), overruling his objection to
confirmation of the bankruptcy plan, and confirming Henry’s Chapter
13 plan. We find that the plan proposed an impermissible
modification of the terms of the agreement between Henry and
Lineberger, and therefore vacate the district court’s order and
remand for further remand to the bankruptcy court for further
proceedings.
Section 1322 of the Bankruptcy Code provides in part that
a proposed Chapter 13 plan may “modify the rights of holders of
secured claims, other than a claim secured only by a security
interest in real property that is the debtor’s principal
residence.” 11 U.S.C. § 1322(b)(2) (2000). “[N]otwithstanding
paragraph (2) of this subsection, [the plan may] provide for the
curing of any default within a reasonable time and maintenance of
payments while the case is pending on any . . . secured claim on
which the last payment is due after the date on which the final
payment under the plan is due.” 11 U.S.C. § 1322(b)(5).
The final payment on the debt to Lineberger was due
before Henry filed her petition in bankruptcy. Thus, Lineberger’s
claim was fully matured prior to the bankruptcy filing and cannot
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be “cured” within the meaning of § 1322(b)(5). See In re Litton,
330 F.3d 636, 643 n.7 (4th Cir. 2003) (stating that “cure provision
applies only to secured claims that have yet fully to mature”).
Although the plan proposed to pay the total amount due with
interest,* this proposal constituted an impermissible modification
of the terms of the debt because it sought to extend the term of
repayment and to alter the interest rate. See id. at 644; In re
Gianguzzi, 145 B.R. 792, 794 (Bankr. S.D.N.Y. 1992) (denying
confirmation and lifting stay for mortgagee where debtor proposed
to pay fully matured mortgage at reduced interest rate over five
year term of plan). Because § 1322(b)(2) prohibits confirmation of
a plan that seeks to modify the terms of a debt secured only by the
debtor’s principal residence, we find that the bankruptcy court
erred in confirming Henry’s Chapter 13 plan, and the district court
erred in affirming that decision.
Accordingly, we vacate the district court’s order and
remand with instructions for further remand to the bankruptcy court
for further proceedings. We dispense with oral argument because
the facts and legal contentions are adequately presented in the
materials before the court and argument would not aid the
decisional process.
VACATED AND REMANDED
*
The parties disagree as to the amount of the claim and the
applicable interest rate. We express no opinion on these issues.
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