           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT United States Court of Appeals
                                                   Fifth Circuit

                                                                            FILED
                                                                         November 5, 2007

                                     No. 07-20400                     Charles R. Fulbruge III
                                   Summary Calendar                           Clerk




In The Matter Of: CONRAD MARK HENCE
                                       Debtor
__________________________________________

INDIAN CAVE PARK PARTNERSHIP

                                                  Appellant
v.

CONRAD MARK HENCE

                                                  Appellee



                   Appeal from the United States District Court
                        for the Southern District of Texas
                              USDC No. 4:07-CV-98


Before REAVLEY, SMITH, and BARKSDALE, Circuit Judges.
PER CURIAM:*
       The district court affirmed the bankruptcy court’s confirmation of a
Chapter 13 repayment plan by Debtor Conrad Mark Hence. Creditor Indian
Cave Park Partnership appeals from the denial of its objection to confirmation,


       *
         Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
                                  No. 07-20400

complaining that the repayment plan does not include interest on prepetition
mortgage arrearages and that the cure is not effected within a reasonable time.
We affirm for essentially the same reasons as stated in the thorough opinions of
the bankruptcy court and the district court.
      Indian Cave is the mortgagee on Debtor Hence’s homestead. In June 2004
Hence executed a promissory note and a deed of trust in connection with the
mortgage. The note provides for an annual interest rate of 5.509% and a
maturity date of July 1, 2019. It also provides for an 18% “annual interest rate
on matured, unpaid amounts.” The note requires Hence to pay principal and
interest in equal monthly installments beginning in August 2004 and ending in
July 2019. If Hence defaults on payment of the note Indian Cave may declare
any unpaid amounts, including the principal balance, immediately due.
      Hence filed a voluntary Chapter 13 petition in June 2006, at which time
he was approximately $5,000 in arrears on his mortgage. Hence’s repayment
plan proposed to cure the arrearage by making monthly payments to Indian
Cave during months 15 through 57 of the plan. The bankruptcy court overruled
Indian Cave’s objections to the plan, and the district court affirmed the
bankruptcy court’s confirmation of the plan.
      On appeal in this court, Indian Cave reiterates its objections that Hence’s
repayment plan fails to provide interest payments and will not be completed
within a reasonable time. We review the decisions of a bankruptcy court by
applying the same standard as the district court. In re Plunk, 481 F.3d 302, 305
(5th Cir. 2007). “Findings of fact are reviewed for clear error, while conclusions
of law are considered de novo.” Id.
      Indian Cave asserts that the district court improperly required it to prove
the amount of its claim with respect to interest payments; that state law
provides for interest on unpaid installment payments; and that the promissory
note and deed of trust require such payments. Where, as here, a proposed plan

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provides for cure of a default “the amount necessary to cure the default[ ] shall
be determined in accordance with the underlying agreement and applicable
nonbankruptcy law.” 11 U.S.C. § 1322(e). Thus, “the only interest that need be
paid is that which is permitted by both the contract and applicable
nonbankruptcy law.” 8 Collier on Bankruptcy ¶ 1322.09[4][b] at 1322-40 (Alan
N. Resnick et al. eds., 15th ed. rev. 2007).
       Like the bankruptcy court and the district court, we are not convinced that
Hence’s promissory note and deed of trust require interest-on-interest payments
as part of the cure. In addition to providing an 18% interest rate on “matured,
unpaid amounts,” the note provides that “[a]ll unpaid amounts are due by the
Maturity Date. After maturity, Borrower promises to pay any unpaid principal
balance plus interest at the Annual Interest Rate on Matured, Unpaid
Amounts.” In the case of a default, the note permits Indian Cave to “declare the
unpaid principal balance, earned interest, and any other amounts owed on the
note immediately due.” The maturity date is specified as July 1, 2019. The note
may be read to require interest payments on unpaid amounts owed, including
defaulted installment payments, only after the maturity date unless Indian Cave
accelerates that date, which it did not do in this case.1
       Indian Cave also argues that the deed of trust required Hence to pay
interest on certain unmet obligations and to also pay its attorneys’ fees and
interest on those fees. The deed of trust states, “If Grantor fails to perform any
of Grantor’s obligations, Lender may perform those obligations and be
reimbursed by Grantor on demand for any amounts so paid, including attorney’s
fees, plus interest on those amounts from the dates of payment at the rate stated
in the Note for matured, unpaid amounts.” As noted by the district court, there

       1
          Indian Cave argues that the bankruptcy court erred in finding the underlying
mortgage agreement ambiguous in the absence of a specific pleading of ambiguity. Indian
Cave did not raise this argument in the district court, and it is therefore not considered. See
In re Bouchie, 324 F.3d 780, 782 n.6 (5th Cir. 2003).

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is no evidence that Indian Cave performed any of Hence’s obligations as
described in the deed of trust. Although the promissory note also provides for
payment of attorney’s fees, the note specifically requires that Indian Cave must
demand such expenses and interest and that the amounts become part of the
debt evidenced by the note. Based on the language of the note and deed of trust,
we conclude that the bankruptcy court did not err in its determination as to
payment of interest on the arrearage.
      Indian Cave further contends that the bankruptcy court erroneously
confirmed Hence’s plan because repayment of the arrearage beginning in month
15 and extending to month 57 is unreasonable. It argues that a reasonable time
for repayment must begin in the first month of the plan and that rather than
consider and balance its interests as a creditor with those of the debtor, the
bankruptcy court simply equated Hence’s best effort at repayment with
reasonableness.
      Under 11 U.S.C. § 1322(b)(5), a Chapter 13 plan may “provide for the
curing of any default within a reasonable time and maintenance of payments
while the case is pending on any unsecured claim or secured claim on which the
last payment is due after the date on which the final payment under the plan is
due.” The bankruptcy court and the district court noted that “a reasonable time”
is not definitively addressed in the Bankruptcy Code, the legislative history, or
the case law, but that the bankruptcy court exercises its discretion to make this
determination on a case-by-case basis.      See also 8 Collier on Bankruptcy
¶ 1322.09[5] at 1322-41 (noting that courts have held that what is reasonable
“depends upon all of the facts and circumstances of the case, including the
amount the debtor can afford to pay and the term of the obligation”). The
bankruptcy court determined that under the proposed repayment plan Hence
was devoting nearly all of his disposable monthly income to curing the arrearage
beginning in month 15 of the plan. The court also noted cases where courts had


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approved cure periods ranging from six months to the full 60-month plan period.
See In re Tudor, 342 B.R. 540, 564 n.12 (Bankr. S.D. Ohio 2005) (citing such
range of cases); see also Grubbs v. Houston First Am. Sav. Assoc., 730 F.2d 236,
237 (5th Cir. 1984) (noting that debtor could, with court approval, cure past due
amounts secured by home mortgage during the entire term of the Chapter 13
plan).    We conclude that the bankruptcy court carefully considered all the
circumstances of the instant case and did not abuse its discretion.
         AFFIRMED.




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