In re Johnson (25-10103-RMM)
The Chapter 12 trustee filed an application for compensation, requesting statutory percentage fees pursuant to 28 U.S.C. § 586(e) on payments the debtor made to secured creditors at a pre-confirmation sale closing. The debtor objected to the application, arguing the trustee is not entitled to collect the statutory percentage fee on the payments at issue.
The relevant statutory language states the trustee “shall collect such percentage fee from all payments received by [the trustee] under plans.” 28 U.S.C. § 586(e)(2). Construing this language, the Court concluded the trustee was not entitled to collect the statutory fee because the payments at issue were not “received by” the trustee but rather disbursed directly to secured creditors at closing.
