11 U.S.C. § 944: Effect of confirmation

Summary

A confirmed plan makes the debtor and all creditors follow its terms, even if a creditor didn’t file a claim, the court didn’t allow the claim, or the creditor didn’t agree to the plan. The debtor is released from all debts when three things happen: (1) the plan is approved, (2) the debtor gives the payments or security to a court-appointed person to distribute, and (3) the court finds the deposited security will be a valid legal obligation of the debtor after distribution and that the payment arrangements are valid. The debtor is not released from debts the plan or approval order excepts, or from debts owed to someone who, before approval, had neither notice nor actual knowledge of the case.

Title 11, §944

Bankruptcy, Source: USLM XML via OLRC

(a)The provisions of a confirmed plan bind the debtor and any creditor, whether or not—

(1)a proof of such creditor’s claim is filed or deemed filed under section 501 of this title;

(2)such claim is allowed under section 502 of this title; or

(3)such creditor has accepted the plan.

(b)Except as provided in subsection (c) of this section, the debtor is discharged from all debts as of the time when—

(1)the plan is confirmed;

(2)the debtor deposits any consideration to be distributed under the plan with a disbursing agent appointed by the court; and

(3)the court has determined—

(A)that any security so deposited will constitute, after distribution, a valid legal obligation of the debtor; and

(B)that any provision made to pay or secure payment of such obligation is valid.

(c)The debtor is not discharged under subsection (b) of this section from any debt—

(1)excepted from discharge by the plan or order confirming the plan; or

(2)owed to an entity that, before confirmation of the plan, had neither notice nor actual knowledge of the case.

Notes & Related Subsidiaries

Historical and Revision Notes

senate report no. 95–989

[section 947] Subsection (a) [enacted as section 944(a)] makes the provisions of a confirmed plan binding on the debtor and creditors. It is derived from section 95(a) of chapter 9 [section 415(a) of former title 11]. Subsections (b) and (c) [enacted as section 944(b) and (c)] provide for the discharge of a municipality. The discharge is essentially the same as that granted under section 95(b) of the Bankruptcy Act [section 415(b) of former title 11].

§944 Effect of Confirmation

Summary

Title 11, §944

Notes & Related Subsidiaries

Historical and Revision Notes

senate report no. 95–989

Citations & Metadata