In re Crager
United States Court of Appeals for the Fifth Circuit
691 F.3d 671 (2012)
Crager (defendant), unemployed and living on $1,060 in monthly Social Security payments with $7,000 in credit card debt and a mortgaged $55,000 home, filed Chapter 13 rather than Chapter 7 specifically because she feared needing to file bankruptcy again and believed Chapter 7 would impose a longer wait before a subsequent filing; the trustee objected that her petition and plan were not filed in good faith and that her attorney's fees, nearly equal to the full amount paid to the trustee, were unreasonable. The bankruptcy court overruled the objection, confirmed the plan, and awarded $2,800 in attorney's fees, but the district court reversed and ordered a bad-faith finding on remand; Crager appealed.
Whether a bankruptcy court may apply a totality-of-the-circumstances analysis in determining whether a chapter 13 bankruptcy petition and plan are proposed in good faith.