UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF KENTUCKY
JONATHAN R. SPITZER CASE NO. 92-20748
This matter is before the Court on the objection to confirmation filed by Carteret Savings Bank, F.A., ("Carteret") in this Chapter 13 proceeding. The objection is based upon the fact that this same debtor has another proceeding pending before this Court under Chapter 7, case no. 91-00081, in which no discharge has been entered as of this date. In that earlier proceeding, an adversary action was filed in which the Court determined that the debt owing to Carteret was non-dischargeable pursuant to 11 U.S.C.'523(a)(2) and '523(a)(6).
The debtor has filed Debtor's Response to Creditor, Carteret's Objection to Confirmation and the Court heard arguments of counsel on the matter on September 1, 1992.
The Supreme Court has specifically held that a debtor is not prevented from seeking relief pursuant to Chapter 13 of the Bankruptcy Code simply because he has recently sought relief under Chapter 7. Johnson v. Home State Bank, 111 S.Ct. 2150 (1991). In that case however the debtor had obtained a discharge from his obligation to Home State prior to filing his Chapter 13 petition. The specific question confronting this court is whether the second proceeding may be maintained before the entry of the discharge.
Judge Stosberg, of the Western District of Kentucky, has confronted this issue in the filing of a Chapter 11 proceeding on the heels of a Chapter 7 proceeding in which the discharge had been set aside. In re Keen, 121 B.R. 513 (Bkrtcy.W.D.Ky. 1990). In that case there appear to be numerous indicators of bad faith. In the present case, no hearing has been held and this Court makes no finding with respect to the good faith or lack thereof on the part of the debtor upon any fact except for the filing of the second petition prior to the granting of a discharge in the first proceeding. However, the Keen case appears to turn upon the legal principle that a debtor cannot maintain two proceedings in bankruptcy at the same time. This Court agrees with this conclusion.
This Court does not hereby imply that the prior proceeding must be closed before the Chapter 13 portion of a "Chapter 20" case can be filed. However, it does appear that, as a minimum, the discharge must have been entered in the previous Chapter 7 proceeding before the debtor would be eligible to seek relief under Chapter 7. See In re Kosenka, 104 B.R. 40 (Bkrtcy.N.D.Ind. 1989), In re Doss, 133 B.R. 108 (Bkrtcy.N.D.Ohio 1990). Until that discharge is entered, there has been no release from prior debts and the debtor cannot know what debts remain to address in the subsequent Chapter 13 proceeding. Another obvious reason is the opportunity for abuse which Judge Stosberg discusses in the Keen opinion.
For the above reasons, a separate order denying confirmation and dismissing this proceeding shall be entered.
Dated this ______ day of _____________, 1992.
By the Court-
Attorney for Debtor
Attorneys for Movant
United States Trustee