Involuntary Petitions Under BAPCPA

Means Testing, Credit Counseling and Debtor Education

Can an individual render oneself ineligible to be an involuntary debtor? Perhaps the most pervasive, or at least the most widely applicable, provisions of the BAPCPA pertain to requirements and restrictions for individual debtors seeking relief under Title 11. Such changes include modifications to the eligibility requirements for all bankruptcy debtors under ' 109, as well as the means testing requirements for Chapter 7 individual debtors whose debts are primarily consumer debts. Despite the widespread commonsense view that Congress did not intend to remove the teeth from involuntary petitions, the prospect that these requirements would provide grounds for an alleged debtor to defeat an involuntary petition were discussed at length prior to, and in the aftermath of, the BAPCPA. The conjecture was that an alleged debtor would defeat an involuntary petition by rendering himself or herself ineligible for relief under Title 11 by failing to have taken a qualified credit counseling course or, to the extent a course could be completed post petition under ' 109(h)(3)(B), that the alleged debtor would simply refuse to attend such a course. Likewise, it was believed that an involuntary petition under Chapter 7 could be subject to dismissal under ' 707(b)(1) due to a presumption of abuse under
' 707(b)(2) if an alleged debtor did not meet strict income and debt requirements imposed by the 'means test.'