In a published opinion, the Fourth Circuit affirmed the denial of confirmation of an above-median Chapter 13 debtor’s plan that proposed to pay off three recently purchased vehicles while paying unsecured creditors less than eight cents on the dollar. In Goddard v. Burnett, No. 25-1303 (4th Cir. Apr. 28, 2026), the court held that technical compliance with the disposable-income test under Section 1325(b) does not insulate a plan from the separate good-faith requirement of Section 1325(a)(3). This ruling creates a circuit split on this issue with the case of Drummond v. Welsh (In re Welsh), 711 F.3d 1120 (9th Cir. 2013).
[Read more…] about Fourth Circuit Holds Good-Faith Review May Consider Whether Secured Property Is Necessary for Above-Median Chapter 13 DebtorsFourth Circuit Rejects Equitable Mootness in Chapter 13 Plan Confirmation Appeal
In a published opinion, the Fourth Circuit held that a district court erred in dismissing a Chapter 13 debtor’s appeal as equitably moot merely because a later plan had been confirmed and payments had begun. In Cook v. Chapter 13 Trustee, No. 25-1048 (4th Cir. Apr. 13, 2026), the court emphasized that equitable mootness is a narrow, pragmatic doctrine reserved for cases where effective relief is no longer practical or would be inequitable. The court concluded that the doctrine did not apply in a straightforward individual Chapter 13 case involving limited creditors, limited assets, and only prospective relief.
[Read more…] about Fourth Circuit Rejects Equitable Mootness in Chapter 13 Plan Confirmation AppealFourth Circuit Appeal in Goddard v. Burnett Examines the Role of Good Faith in Paying Secured Debts in Chapter 13 Plans
On July 16, 2025, the National Consumer Bankruptcy Rights Center (NCBRC) and the National Association of Consumer Bankruptcy Attorneys (NACBA) filed a joint amicus brief in the U.S. Court of Appeals for the Fourth Circuit in support of the debtor-appellant in Goddard v. Burnett, Case No. 25-1303. The case presents a critical question about the interaction between the statutory “means test” and the judicially interpreted “good faith” standard in Chapter 13 bankruptcy cases.
[Read more…] about Fourth Circuit Appeal in Goddard v. Burnett Examines the Role of Good Faith in Paying Secured Debts in Chapter 13 Plans