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Codified Statutes
- U.S. Code
- TITLE 11 — BANKRUPTCY
- CHAPTER 11 — REORGANIZATION(§§ 1101 to 1195)
- SUBCHAPTER V — SMALL BUSINESS DEBTOR REORGANIZATION(§§ 1181 to 1195)
11 U.S.C. § 1191. Confirmation of Plan
(a) Terms —
The court shall confirm a plan
under this subchapter only if all of the requirements of section
1129(a), other than paragraph (15) of that section, of this title
are met.
(b) Exception —
Notwithstanding section 510(a)
of this title, if all of the applicable requirements of section
1129(a) of this title, other than paragraphs (8), (10), and (15) of
that section, are met with respect to a plan, the court, on request
of the debtor, shall confirm the plan notwithstanding the
requirements of such paragraphs if the plan does not discriminate
unfairly, and is fair and equitable, with respect to each class of
claims or interests that is impaired under, and has not accepted,
the plan.
(c) Rule of
construction —
For purposes of this section,
the condition that a plan be fair and equitable with respect to each
class of claims or interests includes the following
requirements:
(1)
With respect to a class of
secured claims, the plan meets the requirements of section
1129(b)(2)(A) of this title.
(2)
As of the effective date
of the plan-
(A)
the plan provides that
all of the projected disposable income of the debtor to be
received in the 3-year period, or such longer period not to
exceed 5 years as the court may fix, beginning on the date
that the first payment is due under the plan will be applied
to make payments under the plan; or
(B)
the value of the
property to be distributed under the plan in the 3-year
period, or such longer period not to exceed 5 years as the
court may fix, beginning on the date on which the first
distribution is due under the plan is not less than the
projected disposable income of the debtor.
(3)
(A)
The debtor will be able to make all payments under the
plan; or
(B)
(i)
there is a reasonable likelihood that the debtor will
be able to make all payments under the plan; and
(ii)
the plan provides appropriate remedies, which may
include the liquidation of nonexempt assets, to protect
the holders of claims or interests in the event that the
payments are not made.
(d) Disposable income —
For purposes of this section,
the term "disposable income" means the income
that is received by the debtor and that is not reasonably necessary
to be expended-
(1)
for-
(A)
the maintenance or
support of the debtor or a dependent of the debtor;
or
(B)
a domestic support
obligation that first becomes payable after the date of the
filing of the petition; or
(2)
for the payment of
expenditures necessary for the continuation, preservation, or
operation of the business of the debtor.
(e) Special rule —
Notwithstanding section
1129(a)(9)(A) of this title, a plan that provides for the payment
through the plan of a claim of a kind specified in paragraph (2) or
(3) of section 507(a) of this title may be confirmed under
subsection (b) of this section.
(f) Special provision related to COVID-19 pandemic —
Notwithstanding section
1129(a)(9)(A) of this title and subsection (e) of this
section, a plan that provides for payment of a claim of a kind
specified in section
503(b)(10) of this title may be confirmed under
subsection (b) of this section if the plan proposes to make payments
on account of such claim when due under the terms of the loan giving
rise to such claim.
Pub. L.
116-54, sec. 2(a), Aug. 23, 2019 133 Stat. 1082
. Pub. L.
116-260, title III, Secs. 320(c),
320(f)(2)(A)(iii), Dec. 27, 2020, 134 Stat. 2016, 2017. Pub. L.
117-151, Sec. 2(f), Jun. 21, 2022, 136 Stat.
1299.
Amendments
2022-Pub. L. 117-151Sec. 2(f), amended Par.
(c)(3) generally. Prior to amendment, text read as
follows:
(A)
(i)
The debtor
will be able to make all payments under the plan;
or
(ii)
there is a
reasonable likelihood that the debtor will be able
to make all payments under the plan; and
"(B)
the plan provides
appropriate remedies, which may include the liquidation
of nonexempt assets, to protect the holders of claims or
interests in the event that the payments are not
made. "
2020-Pub. L. 116-260Sec. 320(c), added
subsection (f).
Effective Date of 2019 Amendment
Pub. L.
116-54, sec. 5, Aug. 23, 2019 133 Stat. 1082,
provided that: Section effective 180 days after Aug. 23, 2019,
see section 5 of Pub. L. 116-54, set out as an Effective Date of
2019 Amendment note under section 101 of this title.