      Case: 18-30526          Document: 00514829916        Page: 1     Date Filed: 02/11/2019




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

                                                                              FILED
                                                                         February 11, 2019
                                            No. 18-30526
                                                                           Lyle W. Cayce
                                                                                Clerk
In the Matter of: WEBSTER BOOKER; LILLIE BRISTO BOOKER,

                        Debtors

------------------------------------------------

WEBSTER BOOKER; LILLIE BRISTO BOOKER,

                        Appellants

v.

TODD JOHNS; FIRST HERITAGE CREDIT OF LOUISIANA, L.L.C.,

                        Appellees


                      Appeal from the United States District Court
                         for the Western District of Louisiana
                                USDC No. 5:16-CV-1604


Before JOLLY, JONES, and DENNIS, Circuit Judges.
PER CURIAM:*
        The court has carefully considered this appeal in light of the briefs, oral
arguments and pertinent portions of the record.                      The bankruptcy court,
affirmed by the district court, found that these elderly Chapter 13 debtors’



        *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 R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH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.
    Case: 18-30526     Document: 00514829916      Page: 2    Date Filed: 02/11/2019


                                  No. 18-30526

second proposed plan of reorganization was not offered in “good faith” as
required by 11 U.S.C. § 1325(a)(3).      A subsequent attempt at a plan was
confirmed, but the debtors exercised their option to appeal because it was less
favorable than the plan that the court refused to confirm. We review the
court’s fact findings, including the ultimate finding of good faith, for clear error
and its conclusions of law de novo. Nationwide Mut. Ins. Co. v. Berryman
Prods. (In re Berryman), 159 F.3d 941, 943 (5th Cir. 1998).
      As all parties including the experienced bankruptcy judge are aware, the
concept of “good faith” in Chapter 13 embodies a number of factors and has a
long legal pedigree. See, e.g., Matter of Chaffin, 816 F.2d 1070, 1073 (5th Cir.
1987) (noting totality of circumstances underlying good faith), op. mod. on
reconsideration, 836 F.2d 215 (5th Cir. 1988); Suggs v. Stanley (In re Stanley),
224 F. App'x 343, 346 (5th Cir. 2007) (listing 7 factors). Here, the transcript
shows that the court predicated a lack of good faith largely on the debtors’
retention of a 1998 model fishing boat, together with motor and trailer, which
served as partial collateral for a loan the debtors are paying off through the
plan. The court considered this inequitable in a plan that was then estimated
to yield only a 4% dividend on unsecured debt. 1
      Although not required to do so, the court did not otherwise particularize
its concerns about the plan in terms of the factors listed in the above cases. We
note, however, several critical but apparently overlooked facts. No one objected
to the debtors’ plan, including the trustee, other lenders and any unsecured
creditors. Even the secured lender on the boat and other collateral related to
the same debt voiced no objection to its treatment. The debtors voluntarily
committed their Social Security receipts to paying off the plan in the absence



      1 The payment percentage was considerably higher vis a vis the final amount of
approved unsecured claims.

                                         2
    Case: 18-30526    Document: 00514829916         Page: 3   Date Filed: 02/11/2019


                                 No. 18-30526

of legal compulsion. Beaulieu v. Ragos (In re Ragos), 700 F.3d 220, 223 (5th
Cir. 2012). The court acknowledged no problems inherent in the debtors’
schedules of expenses, and no issue of credibility was raised.              No one
questioned the debtors’ intent to comply with and fulfill the plan’s payment
schedule. The terms of the plan rejected by the court and the plan finally
accepted differed in only one aspect: the debtors were forced to give up all
collateral for the loan including the boat and its equipment, three TVs and a
riding lawnmower. Otherwise, the proposed payments to unsecured creditors
remained exactly the same.       Given this fact-specific and unusual set of
circumstances, we conclude that the bankruptcy court’s finding of lack of good
faith was clearly erroneous. That is to say, while there is evidence in support
of the court’s finding, “we are left with a firm and definite conviction that a
mistake has been made.” Wilson v. Huffman (In re Missionary Baptist Found.
of Am., Inc.), 712 F.2d 206, 209 (5th Cir. 1983).
      Because the bankruptcy court should have confirmed the plan earlier
proposed by these debtors, we VACATE the judgment approving the
Chapter 13 plan under which the boat and related collateral were forfeit,
REVERSE the finding of lack of good faith concerning the second proposed
plan, and REMAND for further proceedings consistent herewith.




                                        3
