Menu    1 ABR 31 

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF ALASKA



In re:)
)
RODNEY C. KLEPZIG, ) Case No. 3-86-0535
)Chapter 13
Debtor.         )
______________________________________)


ORDER

            At Anchorage in said District this 18th day of July, 1990.

            The Debtor in this Chapter 13 proceeding has filed a motion seeking an order determining the amount due the Internal Revenue Service and allowing him to make final payment. The matter duly came before this Court for hearing on Tuesday, July 10, 1990 and was argued by counsel for the Debtor as well as the Internal Revenue Service.

            Although the Debtor's plan is worded somewhat ambiguously, the Debtor concedes that the plan requires payment of the Internal Revenue Service's secured claim in full together with interest. The Debtor alleges that he has in fact made virtually all necessary plan payments but due to the Trustee's failure to timely disburse funds, approximately $2,000.00 in interest has accrued upon the IRS secured claim. The Debtor does not want to pay the additional interest.

            The Debtor has cited Matter of Irvin, 95 B.R. 1014 (Bankr. W.D. MO. 1989) in support of his position. The facts in Irvin, however, are profoundly different than those at bar. In Irvin the Debtor owed the IRS a pre-petition claim of $2,980.87.   TOP      1 ABR 32  After payment of this amount through the bankruptcy, the sum of $2,887.05 was still outstanding due to long delays in disbursement by the Trustee. Here the Debtor had a pre-petition secured tax claim of $51,442.36. Only about $2,000.00 of the remaining liability of $3,319.38 relates to interest due to late payments. This Court is not confronted with the highly unusual circumstances that the Irvin court faced. Moreover, Irvin is probably bad law within the eighth circuit. Matter of Benson, 64 B.R. 128 (Bankr. W.D.Mo. 1986).

            This Court disagrees with the Debtor's position regarding who should monitor payments and bear the risk of late disbursal. The Debtor voluntarily availed himself of the remedies of Chapter 13 of the Bankruptcy Code, and took certain risks. Those risks, under the circumstances found here, clearly fall upon the Debtor. He was in an excellent position to monitor actual disbursements by the Trustee to insure their timeliness. To suggest that the Internal Revenue Service, with the multitude of cases it confronts, is somehow in a superior position to monitor the payments is not realistic. The IRS cannot not be penalized because of late payments by the Trustee. Finally, as the Debtor's confirmed Chapter 13 plan provides for a 100 percent payment plan to secured creditors, he must pay them in full.

      TOP      1 ABR 33          The Debtor's motion for final payment is granted; the amount due the Internal Revenue Service is determined to be the approximate sum of $3,319.38 as of May 1, 1990 together with accruing interest.



                  DONALD MacDONALD IV
                  United States Bankruptcy Judge

    cy: G. Oczkus
    R. Crowther
    B. Franklin/U.S. Trustee's Office