Loss or damage under this policy shall be paid, as interest may appear, to you and the loss payee shown in the Declarations or in this endorsement. This insurance with respect to the interest of the loss payee, shall not become invalid because of your fraudulent acts or omissions unless the loss results from your conversion, secretion or embezzlement of "your covered auto”…[27]

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“INSURING AGREEMENT
A. We will pay for direct and accidental loss to "your covered auto" or any "non-owned auto", including their equipment, minus any applicable deductible shown in the Declarations.. . .
.  .  .
“LIMIT OF LIABILITY

A. Our limit of liability for loss will be the lesser of the:

     1. Actual cash value of the stolen or damaged property; or

     2. Amount necessary to repair or replace the property with other property of like kind and quality.”
 .  .  . [26]

Had this case been filed prior to the enactment of BAPCPA, the Court would have to decide whether confirmation of the debtors' plan had a res judicata effect on the determination of value of [the creditor’s] secured claim in the light of the Sedona's unsuitability for service. In Gibson, under facts involving a vehicle, a theft, and a fire, the court found that an order confirming a chapter 13 plan fixed the value of the creditor's secured claim. According to Gibson, upon “post-petition destruction of collateral,” courts find that “an undersecured creditor's interest in casualty insurance proceeds [are] limited by the confirmed Chapter 13 plan to the unpaid balance of its allowed secured claim.” In other words, “cramdown has limited the creditor's interest in the collateral to its value at confirmation.” The pre-BAPCPA language of § 1325(a)(5)(B) supported the courts' decisions:


the court shall confirm a plan if—
     (5) with respect to each allowed secured claim provided for by the plan—
     . . .
        (B)(i) the plan provides that the holder of such claim retain the lien securing such claim; and
           (ii) the value, as of the effective date of the plan, of property to be distributed under the

                plan on account of such claim is not less than the allowed amount of such claim;

Revisiting In re Gibson, In re Strzelecki,

and the Fight Over Who is Entitled to Post-confirmation

Insurance Proceeds in Arkansas

by Joe F. Kolb

 

          It is a common occurrence in the bankruptcy arena. Prior to filing a bankruptcy petition, a soon-to-be debtor purchases a truck. He finances the purchase with a lender to whom he gives a security interest in the vehicle. His contact with the lender requires he maintain a policy of collision insurance with the lender named as loss payee. He purchases the required insurance coverage. Sometime later, he files a chapter 13 bankruptcy.

          The debtor formulates a plan of reorganization. He proposes to “cramdown” the lender’s claim - that is, to pay the claim as a secured claim to the extent of the value of the truck determined on the petition date - and to pay the claim as an unsecured claim to the extent his debt exceeds the value of the truck on the petition date. The court confirms the plan.
          Months - often years - after confirmation, the debtor is in an auto accident. The truck is a total loss. The insurance company proffers a check, payable to the debtor and the lender as loss payee, for the value of the truck on the date of the accident. The check exceeds the amount of the unpaid portion of the lender’s allowed secured claim.
          A fight ensues. At issue is who is entitled to receive the post-confirmation insurance proceeds and in what amounts.
          The debtor typically wants the proceeds to purchase a replacement vehicle. He argues that, under the terms of his confirmed chapter 13 plan, the truck creditor is entitled to receive only so much of the insurance proceeds as is necessary to satisfy the unpaid portion of its allowed secured claim. The remaining proceeds should be paid over to the chapter 13 trustee for distribution either to the debtor for the purchase of a replacement vehicle, or to increase the dividend to general unsecured creditors.
          The lender, of course, wants the full amount of the proceeds to the extent of the debtor’s debt without any distinction between the secured and unsecured portions of its claim as determined under the Bankruptcy Code. It sees the proceeds as the product of a contractual obligation of a non-debtor insurance company. And it is bothered by the prospect that a portion of the proceeds generated by the destruction of its collateral could be used to pay other creditors or finance the debtor’s purchase of a replacement vehicle when the debtor still owes it a balance.
          The trustee wants the proceeds to pass through the estate for the benefit of unsecured creditors. He typically argues that he is entitled to at least the proceeds which exceed the amount of the lender’s allowed secured claim for distribution to unsecured creditors under the terms of the debtor’s confirmed plan.
          The Bankruptcy Code does not speak directly to the issue. But there are two Arkansas cases that do. In re Gibson,[1] decided by the Honorable James G. Mixon in 1997, and In re Strzelecki [2] decided by the Honorable Ben T. Barry in 2014. Each takes a different approach to the issue. And each reaches a different conclusion.
          In Gibson, Judge Mixon first considered whether the insurance proceeds were property of the bankruptcy estate under 11 U.S.C § 541. He concluded they were. Therefore, he reasoned, the proceeds should be distributed pursuant to the debtor’s confirmed plan. Under the plan, the creditor was entitled to the proceeds to the extent of the unpaid portion of its allowed secured claim. The estate was entitled to any excess proceeds.
          Judge Barry took a very different approach in Strzelecki. He did not directly address the issue of whether the insurance proceeds were property of the estate. Instead, he focused on the requirements for confirmation of a plan under 11 U.S.C. § 1325. He found subsection 1325(a)(5)(B)(i) requires a confirmed plan to provide that a secured creditor retain its lien until the earlier of payment of the debt determined under non-bankruptcy law, or discharge. Because neither condition had been met, the secured creditor was entitled to the proceeds to the extent of the debt determined under non-bankruptcy law.
          Because of the frequency of the issue in bankruptcy, the vastly different approaches taken by judges Mixon and Barry, and the difference in the outcomes of Gibson and Strzelecki, it seems appropriate to give Gibson and Strzelecki - and the fight over who is entitled to post-confirmation insurance proceeds - a second, more critical, look.

In re Gibson
          The facts in Gibson follow the usual pattern. Before filing bankruptcy, the debtor financed the purchase of a truck with the creditor. Per the purchase contract, the debtor acquired an insurance policy which named the creditor as a loss payee. The policy provided, “we will pay you and the loss payee named in the policy for loss to a covered vehicle, as interest may appear.”[3]
           The debtor subsequently filed a chapter 13 case.
          At the time of filing, the debtor owed the creditor $36,902.73. He proposed a plan to “cramdown” the creditor’s claim by paying $21,975 as a secured claim and $14,927.73 as an unsecured claim.
           The court confirmed the plan.
          Six months later, a third-party stole the truck and set it afire. It was a total loss. The insurance company issued a check payable to the debtor and the creditor in the amount of $28,750.00. At the time, the balance of the creditor’s allowed secured claim was $19,840.47. The total debt – including the secured and unsecured portions of the claim – was $34,768.20.
          Before negotiating the check, the debtor filed a modification to his plan in which he proposed to deliver the check to the trustee to apply the proceeds first to pay off the secured portion of the creditor’s claim, then to the general benefit of the estate.
          The creditor filed an objection to confirmation of the modified plan. It asserted the proceeds of the insurance policy were not property of the estate, but property of the creditor as third-party beneficiary under the insurance policy. The proceeds, therefore, should be paid directly to the creditor.
          Judge Mixon rejected the creditor’s argument off-hand. He found that “[c]ontrary to [the creditor’s] argument, the insurance proceeds at issue are, in fact, property of the estate.”[4]
          The court cited 11 U.S.C. § 541. In relevant part, that section reads:


          (a) . . .[property of the estate] is comprised of all the following property, wherever located and by whomever held:
             (1) … all legal or equitable interests of the debtor in property as of the commencement of the case.
          . . .
             (6) Proceeds, product, offspring, rents, or profits of or from property of the estate, except such as are earnings

                  from services performed by an individual debtor after the commencement of the case.


          Judge Mixon first determined that an insurance contract is “property” as contemplated by section 541.[5] He then reasoned that because the debtor acquired an interest in the contract prior to filing, the contract became property of the estate under section 541 upon the filing of the debtor’s bankruptcy petition.[6]
           Presumably relying on subsection (a)(6) of 541, he further determined that an insured loss under an insurance contract that is property of the estate generates proceeds that are property of the estate.[7]
           He then concluded that since the proceeds of the policy are property of the estate, the Bankruptcy Code should determine the creditor’s interest in the proceeds.[8]
         Referencing Arkansas law, he found a creditor’s interest in insurance proceeds is limited to the value of the creditor’s collateral.[9] Valuation of collateral under the Code is determined in the context of bifurcation of a secured creditor’s claim under 11 U.S.C. § 506.[10] Once a value is determined, and a creditor’s allowed secured claim is fixed, confirmation of the plan has a res judicata effect on the issue value. Upon post-confirmation destruction of the collateral, the creditor’s interest in the insurance proceeds - measured by the value of its collateral - is limited by the confirmed plan to the amount of the unpaid balance of the creditor’s allowed secured claim.[11]
          Judge Mixon, therefore, overruled the creditor’s objection to the debtor’s modification effectively allowing the trustee to receive the insurance proceeds for distribution first toward satisfaction of the unpaid balance of the creditor’s allowed secured claim, then in payment of the claims of other creditors under the debtor’s confirmed plan.

In re Strzelecki
          For 17 years, Gibson was the sole Arkansas case on the issue. Then in 2014, Judge Barry took up the question in the context of a case with facts similar to those in Gibson. Judge Barry, however, took a very different approach from that of Judge Mixon. And he ultimately reached a different result.
          In Strzelecki, the debtors financed the purchase of a minivan with the creditor. The debtors subsequently filed a chapter 13. Upon filing, they proposed a plan to bifurcate the creditor’s claim into a secured claim of $6,000 and an unsecured claim if $9,497. The creditor did not object. The court confirmed the plan.
          Over time, the trustee paid the creditor the full amount of its allowed secured claim and $620 of its unsecured claim.
          Sometime thereafter, the debtors hit a deer and totaled the van. The debtors’ insurance company proffered $3,960 in full satisfaction of its obligation under the debtors’ automobile insurance policy.
          The debtors filed a pleading titled “Motion for Approval of a Property Settlement and to Use Insurance Proceeds.” In it, they asserted the creditor’s secured claim had been paid 100%; the court should direct the insurance company to issue the insurance check directly to the debtors; the court should direct the creditor to release its lien on the title of the minivan and deliver it to the debtors; and the court should grant the debtors permission to use the insurance proceeds to purchase a used vehicle.
          Judge Barry began his analysis of the issue by stating:




















          Judge Barry went on to note, however, that in 2005 Congress amended section 1325 to add subsections (I)(aa) and (I)(bb) to 1325(a)(5)(B)(i). The new provisions require, as a condition of confirmation, that a plan provide that the holder of a secured claim retain its lien securing its claim until the earlier of payment of the underlying debt under nonbankruptcy law, or discharge under section 1328.[13]
          Although his reasoning is not exactly clear from the opinion, Judge Barry announced at the conclusion of his opinion that “[b]ased on the above facts and conclusions of law, the Court finds that [the creditor] has retained its lien on the 2005 Kia Sedona and is entitled to the insurance proceeds in partial satisfaction of that lien.”[14] Accordingly, he denied the debtors’ motion to approve property settlement and to use insurance proceeds thereby allowing the creditor to receive all of the insurance proceeds for application to the debtors’ indebtedness as determined under non-bankruptcy law.

 Who’s right, Who’s wrong, and the Case for Reconsideration of the Issue.

          Happily for those who dislike conflict, Judge Barry’s opinion in Strzelecki side-stepped a direct conflict with Gibson. WestlawNext’s KeyCite shows Gibson as “superseded by statute as stated in In re Strzelecki.” Strzelecki, therefore, seems to have greater precedential value at this point. But is the result in Strzelecki correct? And is Gibson truly superseded? If not, does it, rather than Gibson, reach correct conclusion?
          Since I regularly practice before Judge Barry, I will not answer those questions directly. But I will point out what I perceive as some weaknesses in both cases and attempt to make the case for reconsideration of the issue.

In re Strzelecki
          Beginning with Strzelecki - Judge Barry held that under subsection 1325(a)(5)(B)(i)(I), the creditor retained its lien on its collateral during the pendency of the bankruptcy case. Therefore, the creditor was entitled to the insurance proceeds in partial satisfaction of that lien. Accepting the first proposition – that subsection 1325(a)(5)(B)(i)(I) makes clear that the creditor retained its lien – it remains unclear how it follows that the creditor “is entitled to the insurance proceeds in partial satisfaction of [its] lien?”[15]
          Nothing in 1325(a)(5)(B)(i)(I) speaks to what a secured creditor is entitled to receive on account of its secured claim during the pendency of the bankruptcy case. In relevant part, the statute reads:


     (a) Except as provided in subsection (b), the court shall confirm a plan if—
          .  .  .
         (5) with respect to each allowed secured claim provided for by the plan—
         .  .  .
             (B)(i) the plan provides that—
                    (I) the holder of such claim retain the lien securing such claim until the earlier of—
                       (aa) the payment of the underlying debt determined under nonbankruptcy law; or

                       (bb) discharge under section 1328
        .  .  .

           While clearly the subsection contemplates payment to a secured creditor, it does not determine the amount to be paid a secured creditor under the Code.
           Rather, it is subsection 1325(a)(5)(B)(ii) which speaks to what a secured creditor is entitled to receive on account of its secured claim. In relevant part, that subsection reads:


     (a) Except as provided in subsection (b), the court shall confirm a plan if—
          .  .  .
         (5) with respect to each allowed secured claim provided for by the plan—
          .  .  .
              (B)(ii) the value, as of the effective date of the plan, of property to be distributed under the plan on account of

                        such claim is not less than the allowed amount of such claim
      .  .  .

           When Congress amended 1325(a)(5)(B) to add (I)(aa) and (I)(bb), it left 1325(a)(5)(B)(ii) unaltered. The logical conclusion, therefore, is that Congress did not intend to change what a secured creditor is entitled to receive during the pendency of a bankruptcy case on account of its secured claim by the addition of (I)(aa) and (I)(bb).
           As Judge Barry acknowledged in his opinion, Congress intended the amendment to 1325(a)(5)(B) to address a perceived injustice resulting from a line of cases that held that an undersecured creditor was required to release its lien upon payment of its allowed secured claim.[16] In jurisdictions which followed those cases, an undersecured creditor was left without recourse to its collateral to collect the remaining debt owed it if the case was dismissed after the release of its lien, but prior to discharge. The purpose of the amendment is to preserve to the creditor its lien rights pending discharge, not to alter what an undersecured creditor is entitled to receive under the plan on account of its allowed secured claim.
         The purpose of the amendment can be, and is served without creating a corresponding right for a secured creditor to receive insurance proceeds upon post-confirmation destruction of its collateral. Furthermore, that purpose can be, and is served without adopting an interpretation of section 1325(a)(5(B)(i) that deals a critical blow to the well-established principal that confirmation has a res judicata effect on the issue of the value of the creditor’s allowed secured claim and what the creditor is entitled to receive in satisfaction of that claim.
          In short, there is a gap in the logic of Strzelecki that calls into question its soundness.

 In re Gibson
          Turning then to Gibson. For the sake of argument, we will assume that the amendment to 11 U.S.C. § 1325(a)(5)(B) under BAPCPA did not statutorily supersede its holding as the WestlawNext editorial staff concluded based upon the holding in Strzelecki. Gibson, therefore, may still have precedential value. But a critical reading of the opinion reveals that, like Strzelecki, it too is subject to some criticism.
          Most notably, Gibson relies on an overly broad application of the definition of property of the estate under 11 U.S.C. § 541 – an application that goes beyond the plain meaning of the statute.
          Section 541 defines property of the estate as the debtor’s interest in property, not simply property in which the debtor has an interest.[17] Property of the estate, therefore, is by definition more limited than the aggregate of all property in which the debtor has an interest at the time of filing. In Gibson, Judge Mixon did not explore this important distinction. He simply found that because the debtor had an interest in the insurance contract at the time of filing, the contract was property of the estate. And by extension, the proceeds payable under the contract were property of the estate.
          To accurately determine what property of the estate is, a court must do more than determine that the debtor had an interest in property as of the date of filing. It must determine the nature and extent of that interest. Only the debtor’s interest becomes property of the estate.[18]
          To determine the nature and extent of the debtor’s interest in property, a bankruptcy court must look to state law.[19]
          If the debtor’s interest is limited under state law, it is limited in the hands of the estate.[20] This is true of contractual limitations as well.[21] The estate is comprised of only the rights, title, and interest the debtor held on the petition date.[22] The Code does not expand the title or rights of the debtor.[23]
          Consequently, the question Judge Mixon should have asked was, what is the debtor’s interest in the insurance policy on the date of filing as determined by Arkansas law. It is that interest which became property of the estate upon filing.
          So let us explore this analysis to its logical conclusion. Under Arkansas law, an insurance policy is a contract governed by the ordinary rules of contract interpretation.[24] The debtor’s interest in a policy, therefore, must be determined by reference to the contract itself.
          Not all insurance policies contain the same terms. A debtor’s contractual rights may differ depending on the specific language of the contact at issue.[25] Judge Mixon did not reprint the full insurance contract in Gibson. So for the purposes of our discussion, we will assume it fell in line with the terms of a standard personal auto policy.
          A standard auto policy is divided into parts. Each part addresses a separate risk. “Part D – Coverage for Damage to Your Auto” typically provides:



    












      Further, a typical “Standard” or “Union” loss payee endorsement provides:






          In considering the rights and interests of the insured and a loss payee under policies with similar language, Arkansas courts have consistently held that “[w]hen a mortgagee is named as loss payee in its mortgagor's insurance policy, and a loss occurs, the mortgagee is entitled to enough of the proceeds to satisfy the mortgage indebtedness.”[28]
          It is important to note that these cases make no distinction between secured and unsecured indebtedness. All other conditions being met, the loss payee’s right to recovery is dependent only upon (1) the loss payee being designated as such in the policy and (2) the loss payee having an insurable interest in the insured property at the time of the effectuation of the insurance and at the time of the loss. An “insurable interest” is defined as “any actual, lawful, and substantial economic interest in the safety or preservation of the subject of the insurance free from loss, destruction, or pecuniary damage or impairment.”[29] Accordingly, a loss payee’s right to recovery is not dependent of the existence of a security interest or the perfection of that security interest.
          Further, the Arkansas Supreme Court has cited with approval, Couch, Insurance 2d § 29:65 (1960) wherein it states, “[a] loss payable clause gives the payee thereunder a superior right in the proceeds to the extent of his interest and the insured can only recover any balance in excess thereof.” (emphasis added)[30] In other words, a creditor’s interest in the proceeds is a priming interest. A debtor’s interest is subject to, and limited by the loss payee’s contractual rights to the proceeds payable under the policy. It is that limited interest in the contract which becomes property of the bankruptcy estate.
          Under this analysis, insurance proceeds payable under a policy of insurance purchased by a debtor pre-petition are not property of the estate to the extent of the creditor’s interest in the proceeds. The Bankruptcy Code, therefore, does not determine the rights of the creditor in the proceeds. The proceeds are payable to the loss payee to the extent they are payable under the contract and applicable state law. That is, the creditor is entitled to sufficient proceeds to satisfy the debtor’s indebtedness determined under non-bankruptcy law and without regard to whether the debt is secured or unsecured.[31]
          Under this analysis, confirmation of the debtor’s plan does not limit the creditor’s interest in the proceeds to the unpaid portion of the creditor’s allowed secured claim. This is so because the creditor’s interest in the proceeds is not property of the bankruptcy estate and, therefore, is not subject to the Code’s distribution scheme.

The Case for Reconsideration
          As for the case for reconsideration of the issue, the analysis outlined in the preceding paragraphs avoids a number of problems related to both Gibson and Strzelecki.
          First, it relies on the plain language of the relevant Code sections. As discussed above, Gibson misses the mark with respect to the plain language of 11 U.S.C. § 541. And Strzelecki misses the mark with respect to the plain language of 11 U.S.C. § 1325(a)(5)(B).
          Second, it gives effect to and harmonizes all relevant sections of the Code, including 11 U.S.C. §§ 506, 541, and 1325. In addition, it harmonizes the Code with Arkansas statutory and case law, notably with regard to defining the debtor’s interest in an insurance contract and the fact that insurance proceeds are not the product of the insured property.
          Third, it does not call into question the res judicata effect of confirmation as Strzelecki does, or attempt to ascribe the value of one property right (a security interest in vehicle) to another property right (the insurance proceeds) as Gibson does.
          Fourth, it results in both the debtor/estate and the creditor receiving the exact benefits bargained for in the procurement of the insurance policy.
          Fifth, it effectively eliminates many troublesome issues that that can and will occur under Gibson and Strzelecki. To identify a couple - consider a situation in which a chapter 13 is dismissed prior to discharge, but after payment of insurance proceeds. Under Gibson, the debtor’s other creditors – and by extension the debtor – will receive a windfall since they will receive a portion of the insurance proceeds. While the secured creditor who is named as a loss payee under the insurance policy has both been stripped of its contractual right to recover the full insurance proceeds under policy and rendered an unsecured creditor by the destruction of its collateral.
          Consider also the situation in which the debtor has paid the creditor’s allowed secured claim in full, but there remains a $5,000 unsecured claim. The debtor then sets fire to vehicle. The insurer denies coverage to the insured, but proceeds are payable to the loss payee under a “Standard” or “Union” loss payee clause or lender’s endorsement. Under Gibson, the insurance proceeds are property of estate and must be paid to the trustee for distribution to unsecured creditors - a benefit to the guilty debtor - even though the debtor has no independent right to receive those proceeds under the contract.
          These issues can be avoided, the plain meaning of the relevant Code sections can be given effect, conflicts among Code sections can be harmonized, misinterpretations of state law can be corrected, and a fair result can be had, all by taking a new approach to this common issue.

Conclusion

          Accordingly, a critical look at In Re Gibson and In Re Strzelecki suggests the issue of who is entitled to post-confirmation insurance proceeds merits a thorough reconsideration.


_____________________________
[1] In re Gibson, 218 B.R. 900 (Bankr. E.D. Ark. 1997), decided by Hon. James G. Mixon, bankruptcy judge. Kent Pray, North Little Rock, AR, for debtor. Richard Kalkbrenner, Little Rock, AR, for the creditor, Newcourt Financial
[2] In re Strzelecki, 509 B.R. 671 (Bankr. W.D. Ark. 2014), decided by Hon. Ben T. Barry, bankruptcy judge. John Blair and Don Brady, Rogers, AR, for debtors. Holly N. Knight, Nashville, TN, and Curtis Clements, for creditor, AmeriCredit.
[3} In re Gibson, 218 B.R. 900, 902 (Bankr. E.D. Ark. 1997)
[4] Id. at 903
[5] Citing A.H. Robins Co. v. Piccinin, 788 F.2d 994, 1001 (4th Cir. 1986) (insurance contracts have been said to be embraced in this statutory definition of “property.”).
[6] In re Gibson, 218 B.R. 900, 903 (Bankr. E.D. Ark. 1997)
[7] Id.
[8] Id.
[9] Id. at 904. Judge Mixon cited Wilbanks & Wilbanks, Inc. v. Cobb, 269 Ark. 936, 601 S.W.2d 601 (Ct.App.1980) as support for the proposition that under Arkansas law, a creditor’s interest in an insurance policy is limited to the value of its collateral. However, the Wilbanks court did not so hold. It held only that a creditor’s interest in a policy is limited by its interest in its collateral. It did not, however, limit the creditor’s interest in its collateral to its value. In Wilbanks, the insured purchased two sets of equipment in succession. He pledged each set to a different secured creditor. However, he purchased one insurance policy to cover both sets. It appears he named both creditors as loss payees under the policy, though the opinion is not clear on that point. Both sets of equipment were subsequently damaged or destroyed by fire. The insurance company proffered insurance proceeds to each secured creditor based upon the value of its respective collateral. One creditor demanded payment of the full amount payable under the insurance policy, which included the value of the equipment in which he did not have a security interest. The issue before the court was whether a secured creditor who was listed as loss payee under a policy of insurance was entitled to the full amount of the insurance proceeds payable under the policy which constituted proceeds of property in which the creditor claimed a security interest and property in which the creditor did not claim a security interest. The court held that the creditor had a right to only the proceeds payable as a result of the destruction of its collateral, not the other equipment in which he did not have an interest. Wilbanks, therefore, does not support the proposition advanced by Judge Mixon.
[10] In re Gibson, 218 B.R. 900, 903 (Bankr. E.D. Ark. 1997)
[11] Id.
[12] In re Strzelecki, 509 B.R. 671, 673 (Bankr. W.D. Ark. 2014) (omitting citations).
[13] In relevant part, section 1325(a)(5) reads:
               (a) Except as provided in subsection (b), the court shall confirm a plan if--
               . . .
                   (5) with respect to each allowed secured claim provided for by the plan--
               . . .
              (B)(i) the plan provides that--
                    (I) the holder of such claim retain the lien securing such claim until the earlier of--
                       (aa) the payment of the underlying debt determined under nonbankruptcy law; or
                       (bb) discharge under section 1328; and
                 (II) if the case under this chapter is dismissed or converted without completion of the plan, such lien shall

                      also be retained by such holder to the extent recognized by applicable nonbankruptcy law;
              . . .
11 U.S.C. § 1325 (West)
[14] In re Strzelecki, 509 B.R. 671, 674 (Bankr. W.D. Ark. 2014)
[15] Id.
[16] In re Strzelecki, 509 B.R. 671, 674 (Bankr. W.D. Ark. 2014), citing 8 Collier on Bankruptcy ¶ 1325.06[3][a], at 1325–33 (16th ed. rev.) (2013)
[17] 11 U.S.C. § 541 (West)
[18] In re Martin, 205 B.R. 143, 144 (Bankr. E.D. Ark.) aff'd sub nom. Martin v. Martin, 213 B.R. 575 (E.D. Ark. 1997) aff'd sub nom. In re Martin, 141 F.3d 1169 (8th Cir. 1998)
[19] Butner v. United States, 440 U.S. 48, 99 S.Ct. 914, 59 L.Ed.2d 136 (1979); In re Cheqnet Sys., Inc., 246 B.R. 873, 877 (Bankr. E.D. Ark. 2000)
[20] In re Graphics Tech., Inc., 306 B.R. 630, 634 (B.A.P. 8th Cir.) aff'd sub nom. In re Graphic Technologies, Inc., 113 F. App'x 734 (8th Cir. 2004)
[21] In re Hunter, 201 B.R. 959, 960 (Bankr. E.D. Ark. 1996)
[22] Id.
[23] Matter of Sanders, 969 F.2d 591, 593 (7th Cir. 1992)
[24] Entm't Innovators, Inc. v. Scottsdale Ins. Co., 839 F. Supp. 654, 658 (W.D. Ark. 1993); State Farm Fire & Cas. Co. v. Michael, 822 F. Supp. 575, 577 (W.D. Ark. 1993).
[25] See Unigard Ins. Co. of Seattle v. Wish, 254 Ark. 832, 836, 496 S.W.2d 392, 394 (1973)
[26] PP 00 01 01 05 © ISO Properties, Inc., 2003
[27] PP 03 05 08 86 Copyright, Insurance Services Office, Inc., 1986
[28] Bunn v. Luthultz, 70 Ark. App. 26, 28, 13 S.W.3d 915, 916 (Ark.App.,2000); Echo, Inc. v. Stafford, 21 Ark.App. 201, 205, 730 S.W.2d 913, 915 (1987)
[29] Ark. Code Ann. § 23-79-104 (West)
[30] Wilbanks & Wilbanks, Inc. v. Cobb, 269 Ark. 936, 938, 601 S.W.2d 601, 603 (Ct. App. 1980)
[31] See endnote [9].