GEORGE BOSWELL, Bankruptcy Judge
The Court conducted a trial in this matter on April 16, 1999. FED. R. BANKR. P. 7001. Pursuant to 28 U.S.C. § 157(b)(2), this is a core proceeding. After reviewing the testimony from the trial and the record as a whole, the Court makes the following findings of facts and conclusions of law. FED. R. BANKR. P. 7052.
On March 25, 1996, the Chancery Court of Crockett County, Tennessee, issued an order which found that "the deed heretofore executed by . . . Emma Clark, to . . . Randy Perry, is hereby held to be void Ab Initio for overreaching fraud and deceit." The order further found that Emma Clark was "entitled to a judgment against . . . Randy Perry, for the sum of Five Thousand Dollars ($5,000), plus interest at the rate of ten percent (10%), from February 20, 1991." Said judgment was affirmed on appeal on March 19, 1998.
The award of attorneys fees was reversed on appeal, but the monetary judgment against the Perrys was upheld.
On May 7, 1996, Randy and Connie Perry, (hereinafter "Perrys"), filed a chapter 13 petition for bankruptcy relief. In said petition, the Perrys listed Emma Clark, (hereinafter "Clark"), as an unsecured non-priority creditor with a claim of $15,000.00. Clark filed a secured proof of claim in the Perrys' case for $155,000.00. On June 19, 1996, Emma Clark filed an objection to confirmation of the Perry's chapter 13 plan based on allegations of "bad faith and fraud by defendant." Clark filed the instant complaint objecting to discharge of her debt on May 14, 1998. In said complaint, Clark alleged that her claim against the Perry's chapter 13 estate was non-dischargeable under 11 U.S.C. § 523(a)(2). On June 1, 1998, the Perrys filed an Objection to the Claims of Emma Clark in which they alleged that Clark's claims against their estate should be treated as general unsecured claims and that Clark's claims against the estate should be denied. On September 16, 1998, the Court consolidated the adversary proceeding and the objection to claims and objection to confirmation.
Section 1328 of the Bankruptcy Code provides that:
(a) As soon as practicable after completion by the debtor of all payments under the plan, . . . the court shall grant the debtor a discharge of all debts provided for by the
plan or disallowed under section 502 of this title, except any debt —
. . .
(2) of the kind specified in paragraph (5), (8), or (9) of section 523(a) of this title; . . .
11 U.S.C. § 1328(a)(2). As a result, § 523(a)(2) has no effect in a chapter 13 bankruptcy and does not serve to except any debts from a chapter 13 discharge. For this reason, the plaintiff's adversary complaint against the debtor/defendants must be denied.
Section 1325 of the Bankruptcy Code provides:
(a) Except as provided in subsection (b), the court shall confirm a plan if — . . .
(3) the plan has been proposed in good faith and not by any means forbidden by law;
11 U.S.C. § 1325(a)(3). Subsection (3)'s requirement of good faith relates to the debtor's conduct in filing the chapter 13 plan and not the debtor's conduct in incurring the debt. Although the state court concluded that the contract between Clark and the Perrys was void based on the Perrys' fraudulent conduct, no proof was introduced at the trial in the case at bar regarding the debtors' conduct in
filing their chapter 13 petition. As a result, Clark's Objection to Confirmation must be overruled.
Insofar as the debtors have asked the Court to deny Clark's claims against their estate, no proof or argument was introduced at the trial to support such a denial. Clark's claim shall be included within the Perry's chapter 13 case and plan as a general unsecured claim in the amount of $5,000.00 plus interest at the rate of 10% per annum since February 20, 1991.
ORDER
It is therefore ORDERED that the Complaint Objecting to Discharge of the Debt Owed to Emma Clark is DENIED.
It is FURTHER ORDERED that the Objection to Claims of Emma B. Clark filed by the debtor is OVERRULED.
It is FURTHER ORDERED that the Objection to Confirmation of Debtor's Chapter 13 Plan filed by Emma Clark is OVERRULED.
IT IS SO ORDERED.