As of December 1, 2017 chapter 13 plans are required to use a national form chapter 13 plan. Ostensibly, these changes are designed to allow creditors and other parties to be able to efficiently review and understand the proposed plan repayment terms. The rule effectively requires the use of an official national form plan (Form 113) unless a local uniform plan is adopted by that district. Following the implementation of this rule, most jurisdictions opted to create their own “uniform” plan.
All local plans however have some minimum requirements. Bankruptcy Rule 3015.1 mandates that each district may have only one form, typeface requirements, an initial paragraph indicating whether a non-standard provision is added (more to come on that), and whether the rights of secured creditors are affected. Further, all local plans must indicate separately whether it cures defaults, makes payments on domestic-support obligations, pays priority debts (e.g. certain taxes), or surrenders property.
Finally, the rule requires that a final paragraph be included to list non-standard plan provisions. According to the official Committee Notes to this rule: “This part gives the debtor or debtors the opportunity to propose provisions that are not otherwise in, or that deviate from, the Official Form.” This is where uniform plans suddenly become non-uniform.
Debtor’s have used this provision to include and propose non-standard bankruptcy provisions dealing with issues ranging from how a bank is to credit mortgage payments to credit reporting requirements. However, debtors are not alone in requiring or allowing other non-standard plan provisions. Several chapter 13 trustees have “uniform” non-standard provisions addresses issues such as the retention of tax refunds during the course of the bankruptcy. Further, several bankruptcy courts have include mandatory “non-standard” provisions to their local form plan. Finally, some creditors object to plans unless certain provisions are added (e.g. to protect their liens).
So, are chapter 13 plans uniform? They are with respect to the ease of reading the plan. However, the effect of the plan can be dramatically different from district to district and perhaps by each judge. This is reflective of the common misconception that there are “garden variety” bankruptcies. Debtor’s counsel know this is not the case as no client has identical facts. The lesson is to fully read and understand each plan including the non-standard provisions.