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Bankruptcy Court Holds Failure To Pay Child Support Justifies Conversion to Chapter 7

Rhode Island's bankruptcy court has held that a debtor's failure to pay post-petition child support was a sufficient basis to convert his Chapter 13 bankruptcy to a Chapter 7. 

The debtor and his wife had divorce proceedings in the Rhode Island Family Court in which the court entered an order requiring the debtor to pay child support of $250 per week.   The debtor filed a Chapter 13 bankruptcy in 2012.  Section 1307(c)(11) of the Bankruptcy Code authorizes the court to convert a Chapter 13 bankruptcy to a Chapter 7 if the debtor fails to pay a "domestic support obligation that first becomes payable after the date of the filing of the petition."  The Court found that this phrase includes child support payments due after the filing of the petition but not any prepetition arrearages. 

The Court also found that converting the bankruptcy to a Chapter 7 was in the best interest of creditors and the bankruptcy estate.  The conversion would enable an expeditious sale of the debtor's residence by the trustee.  The trustee could use proceeds from the sale to pay unsecured creditor's including the debtor's ex-wife. 

In re Brian David Krivitsky, 2012 WL 6858958 (Bank.R.I. Dec. 17, 2012).

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