Court Opinions: 10th Circuit Court of Appeals Opinion for Jan. 18

The 10th Circuit Court of Appeals

Editor’s Note: Law Week Colorado edits court opinion summaries for style and, when necessary, length.

Doll, et al. v. Goodman

In 2017, Daniel Doll lived in Rifle, Colorado, and was the sole proprietor of Doll Ventures LLC, a business that repaired forklifts. Doll, through counsel, initiated a Chapter 13 bankruptcy case in November 2017. Doll proposed four reorganization plans over the next year and a half. Each proposed plan called for Doll to make monthly payments to the standing trustee for the benefit of his creditors. The bankruptcy court declined to confirm any of those plans based on objections from the standing trustee, Doll’s former spouse and their attorney. After the fourth denial, Doll declined to file another amended plan and the bankruptcy court dismissed the case. By that time, Doll had made pre-confirmation payments to the standing trustee totaling $29,000. 

From those pre-confirmation payments, the standing trustee paid $19,800 to Doll’s bankruptcy attorney for attorney’s fees, more than $7,500 to the Colorado Department of Revenue to cover some of Doll’s taxes and retained just under $2,600 as the trustees’ fee. 

Doll then filed a motion to disgorge trustee’s fees where Doll sought to have the standing trustee return to Doll the roughly $2,600 fee the trustee kept, arguing the trustee wasn’t entitled to any fee because no plan had been confirmed before Doll’s case was dismissed. 

The bankruptcy court denied Doll’s motion and Doll appealed. The district court reversed the bankruptcy court’s decision, ruling the standing trustee wasn’t entitled to keep the fee. The trustee appealed the district court’s decision.

The 10th Circuit Court of Appeals affirmed the district court’s decision, ruling that Title 28 of the U.S. Code Section 586(e)(2) and Title 11 of Section 1326(a), when read together, unambiguously provide that a Chapter 13 standing trustee must return pre-confirmation payments to the debtor without deducting the trustee’s fee when a proposed plan isn’t confirmed.

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