HAMILTON v. LANNING

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Case Basics
Docket No. 
08-998
Petitioner 
Jan Hamilton, Chapter 13 Trustee
Respondent 
Stephanie Kay Lanning
Advocates
(for the petitioner)
(for the respondent)
(Assistant to the Solicitor General, Department of Justice, for the United States as amicus curiae, supporting the respondent)
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Facts of the Case 

A Kansas federal bankruptcy court denied objections to a Chapter 13 debtor's repayment plan. The Bankruptcy Appellate Panel of the Tenth Circuit affirmed the lower court's decision. On appeal, the U.S. Court of Appeals for the Tenth Circuit affirmed, holding that the starting point for calculating a Chapter 13 debtor's "projected disposable income" is presumed to be the debtor's current monthly income. However, the court stated that the calculation is subject to a showing that there is a substantial change in circumstances. The court remanded the case to the bankruptcy court to determine whether the debtor had shown there was a substantial change in her circumstances.

Question 

In calculating a debtor's "projected disposable income," may the bankruptcy court consider evidence suggesting that the debtor's income or expenses during that period are likely to be different from the debtor's income or expenses during the pre-filing period?

Conclusion 
Decision: 8 votes for Lanning, 1 vote(s) against
Legal provision: Bankruptcy Abuse Prevention and Consumer Protection Act of2005 (BAPCPA)

Yes. The Supreme Court affirmed the Tenth Circuit, holding that a bankruptcy court may account for changes in the debtor's income or expenses that are "known or virtually certain" at the time of confirmation when it calculates a debtor's projected disposable income. With Justice Samuel A. Alito writing for the majority, the Court reasoned that the plain meaning of "projected disposable income" within the statute supports the Court's holding.

Justice Antonin Scalia dissented. He disagreed with the majority's interpretation of the term "projected." He maintained that the term did allow for a bankruptcy court to depart from the "inflexible formula" provided by the statute.

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HAMILTON v. LANNING. The Oyez Project at IIT Chicago-Kent College of Law. 23 October 2014. <http://www.oyez.org/cases/2000-2009/2009/2009_08_998>.
HAMILTON v. LANNING, The Oyez Project at IIT Chicago-Kent College of Law, http://www.oyez.org/cases/2000-2009/2009/2009_08_998 (last visited October 23, 2014).
"HAMILTON v. LANNING," The Oyez Project at IIT Chicago-Kent College of Law, accessed October 23, 2014, http://www.oyez.org/cases/2000-2009/2009/2009_08_998.