An understanding of the rights and powers of the various parties involved in a Chapter XIII proceeding is not easily had. The statutory language is somewhat windblown, sometimes confused and frequently ambiguous. Reported decisions in Chapter XIII cases are few. However, Chapter XI, dealing with arrangements, and Chapter XIII, dealing with wage earner plans, contain many identical or quite similar provisions, so that an interpretation of one of the chapters often has significance as authority for a like position under the other chapter. Where such is the case, reference will be made to cases decided under or a treatise on Chapter XI. In order to eliminate undue detail, this analysis will be confined to proceedings arising under section 622, except where noted otherwise A section 622 proceeding is one initiated by the debtor who files an original petition under Chapter XIII at a time when no bankruptcy proceeding is pending by or against him. Of course, section 622 proceedings comprise nearly all of the Chapter XIII cases filed. From the outset it is helpful to keep in mind two basic principles of Chapter XIII. First, a Chapter XIII proceeding is voluntary with the debtor from beginning to end. Second, Chapter XIII envisions payment by the debtor of his creditors primarily out of future earnings. Of fundamental importance is section 602. There it is stipulated that the provisions of Chapters I to VII (the ordinary bankruptcy sections 1 to 72) shall apply to Chapter XIII proceedings insofar as they are not inconsistent or in conflict with the provisions of Chapter XIII, and that, for the purposes of such application in a section 622 proceeding, the date of the petition in bankruptcy and the date of adjudication shall be taken to be the date of the filing of an original petition under section 622. The general incorporating provisions of section 602 are supplemented in Chapter XIII by other incorporating provisions of a more specific nature. These further provisions declare that, where not inconsistent with the provisions of Chapter XIII, certain rights, powers and duties shall be the same in a section 622 proceeding as if a voluntary petition for adjudication in bankruptcy had been filed and a decree of adjudication had been entered at the time the section 622 petition was filed. Thus, it is provided that the jurisdiction, powers and duties of the court shall be the same (section 612); the powers and duties of the officers of the court and the rights, privileges, and duties of the debtor shall be the same (section 636); and the rights, duties, and liabilities of creditors and of all other persons with respect to the property of the debtor shall be the same (section 641).
John T. Copenhaver Jr.,
Bankruptcy--Rights and Powers in Chapter XIII,
W. Va. L. Rev.
Available at: https://researchrepository.wvu.edu/wvlr/vol68/iss4/3