Rochelle's Daily Wire

District court rules that proceeds from a postpetition personal injury claim are ‘additional disposable income’ that ordinarily goes to creditors in a chapter 13 plan.

Rather than invoking the best interests and disposable income tests for plan confirmation, the Eleventh Circuit may have departed from the statute by ruling that the ‘ability to pay’ gives postpetition tort claims to creditors in chapter 13.

Judge Callaway explains when a debtor keeps insurance proceeds and when it goes to creditors under a chapter 13 plan.