Opinion
Case No. 95-11924-SSM, Adversary Proceeding No. 95-1419
July 23, 1998
MEMORANDUM OPINION
This matter is before the court on a motion by Sequoia National Bank under 28 U.S.C. § 1963 to register in other districts the $763,304.03 money judgment it obtained against the debtors in this court. A hearing was held on June 23, 1998, at which both parties were represented by counsel. The only issue before the court is whether registration of the judgment, to the extent it seeks enforcement of the judgment against assets owned by the debtors at the time their plan was confirmed, violates the terms of the confirmed plan.
Background
Robert and Marilyn DeLuca ("the DeLucas") are real estate developers who, at the time of the events giving rise to this action, had a large portfolio of real estate projects in the Northern Virginia and Newport News/Williamsburg area. On May 5, 1995, they filed a voluntary chapter 11 petition in this court, and, in the weeks immediately preceding and following their own filing, caused chapter 11 petitions to be filed on behalf of thirteen of the partnerships, limited partnerships, and limited liability companies they owned or managed. Subsequent to the filing of the petition, Sequoia National Bank ("Sequoia") filed a timely complaint to determine the dischargeability of its claim. Prior to the trial of the dischargeability action, the DeLucas proposed and obtained confirmation of a Fourth Amended Plan of Reorganization ("the plan"). Relevant to the present controversy, the plan placed creditors with pending dischargeability complaints in two classes. As the holders of general unsecured claims (Class 8), they were to be paid 40% of the allowed amount of their claims in equal semi-annual installments within 60 months of the effective date of the plan out of "Net Entity Income." Plan § 2.08. "Net Entity Income" in turn is defined as the debtors' right to distributions from four named "DeLuca Entities": Baronwood Associates, L.P., Countryside Commercial Professional Center, L.P., Harmon Building Associates, L.P., and R M Villas, L.C. Plan §§ 1.18, 1.13, 1.02, 1.08, 1.15, and 1.21. In addition, the following further provision was made for them:
Class 12 — Adversary Proceeding Plaintiffs: Plaintiffs in dischargeability proceedings pending before the Court who obtain judgments or settlements will share in distributions made under Class 8 above. Any additional amounts owed to these creditors, whether by virtue of Court Order or settlement by Debtors, will be paid by Debtors from property outside the Bankruptcy Estate, such as from post-petition income or earnings of Debtors.
Plan § 2.12 (emphasis added). Sequoia did not object to confirmation and, indeed, filed a ballot accepting the plan. After notice and a hearing, the plan was confirmed by order entered September 19, 1997. No appeal was taken from the order confirming the plan, and that order is now final.
On February 12, 1998, Sequoia's nondischargeability action was tried, and on February 13, 1998, a judgment was entered determining that Sequoia's claim in the amount of $763,304.03 was nondischargeable under § 523(a)(2)(B), Bankruptcy Code, on the ground that Sequoia's loans to the DeLucas had been obtained by means of a false financial statement. As part of the dischargeability determination, the court entered a money judgment in favor of Sequoia against the debtors in that amount. The debtors filed a timely notice of appeal to the United States District Court on February 20, 1998, but did not post a supercedeas bond or otherwise obtain a stay of the judgment pending appeal.
On July 20, 1998, the District Court affirmed the judgment. The time for filing an appeal of the District Court's judgment is 30 days from the entry of the order. Fed.R.App.P. 4(a)(1). Accordingly, the judgment is not yet final.
Sequoia filed the motion presently before the court on June 8, 1998, to allow the judgment to be registered in other districts under 28 U.S.C. § 1963. The debtors oppose the motion and not only assert that registration would violate the terms of the confirmed plan, but also complain that Sequoia has already violated the plan by recording the judgment on June 12, 1998, among the land records of Broward County, Florida, under the Uniform Enforcement of Judgments Act.
The debtors filed an amended response to Sequoia's motion on June 18, 1998, raising the issue of the judgment having been recorded and asserting "this action by Sequoia National Bank is a clear violation of the Debtors' confirmed plan and should be addressed by the court."
Discussion I.
Sequoia's motion is brought under 28 U.S.C. § 1963, which provides in pertinent part:
A judgment in an action for the recovery of money . . . entered in any . . . bankruptcy court . . . may be registered by filing a certified copy of the judgment in any other district . . . when the judgment has become final by appeal or expiration of the time for appeal or when ordered by the court that entered the judgment for good cause shown.
(emphasis added). Since the judgment has not yet become final "by appeal or expiration of the time for appeal," the judgment may be registered at this time only if ordered by the court upon a showing of "good cause." As cause, Sequoia points to the fact that the debtors do not appear to have sufficient property in this district to satisfy the judgment but do have substantial real property in Florida. See Jack Frost Labs v. Physicians Nurses Mfg. Corp., 951 F. Supp. 51, 52 (S.D. N.Y. 1997). The debtors, however, argue that Sequoia would not be permitted under the terms of the confirmed plan to enforce its judgment against the Florida real estate even if the judgment were final, and that, accordingly, there can be no "good cause" to allow the judgment to be registered while the appeal is pending. Sequoia in turn argues that nothing in the plain language of the plan restricts it from enforcing its claim against any property of the debtor, and that, even assuming the plan language could be read that broadly, the plan would be plainly inconsistent with § 1141(d)(2), Bankruptcy Code, and could not have been confirmed.
The debtors' schedules reflect that they own a condominium in Hillsboro Beach, Florida, valued at $950,000, and subject to a deed of trust in the amount of $418,054. On their schedules, the debtors claimed only a $1 interest in the property as exempt. The deed of trust is treated under the plan in Class 7, which provides for the curing of any prepetition arrearages within 18 months, and the making of post-confirmation payments according to the terms of the note. Based on statements made by counsel at oral argument, it appears that the debtors are currently attempting to sell the property in order to raise money for the defense of an indictment that has been brought against them for bankruptcy and mail fraud. Although the United States District Court for this district had entered an order on April 16, 1998, freezing the debtors' assets, a subsequent order was entered on May 22, 1998, releasing the condominium from restraint if the debtors filed with the District Court an affidavit that, as of April 16, 1998, they had made all payments then required to be made to creditors under the plan.
II.
The initial inquiry is whether the language of the confirmed plan prohibits what Sequoia now wants to do, which is to enforce its claim, not only against assets acquired by the debtors post-confirmation, but also against assets owned by the debtor at the time of plan confirmation. Sequoia argues that to the extent § 2.12 of the plan actually restricts enforcement of its nondischargeable claim to "property outside the Bankruptcy Estate," confirmation of the plan had the effect of vesting all property of the estate in the reorganized debtors, so that the Florida property is no longer, in literal terms, property of the estate. Plan § 6.01; 11 U.S.C. § 1141(b).
The plan expressly provides that this court retains jurisdiction, following confirmation, for "the reconciliation of any inconsistency in this Plan" and "the interpretation of the terms and conditions of this Plan." Plan § 6.02(c) and (e).
"Upon confirmation, the Debtors shall be vested with all of the Debtors' property subject only to the terms of this Plan."
"Except as otherwise provided in the plan or the order confirming the plan, the confirmation of a plan vests all of the property of the estate in the debtor."
As an abstract proposition of law, this is undoubtedly correct: confirmation, except to the extent provided otherwise in the plan of reorganization, revests all property of the bankruptcy estate in the reorganized debtor. But to read the phrase "property outside the Bankruptcy Estate" in § 2.12 in isolation — and to wholly ignore the follow-on phrase "such as postpetition income or earnings of Debtors" — does considerable violence to the section as a whole and renders it essentially meaningless. The more natural and straightforward reading of the sentence is that creditors holding nondischargeable claims may look, in addition to the distributions to which they are entitled under the plan, only to assets that were not property of the estate when the plan was confirmed — that is, assets acquired by the debtors after confirmation or abandoned prior to confirmation. Otherwise, there would be nothing to prevent a creditor holding a nondischargeable claim from torpedoing the plan by enforcing that claim against property needed for the performance of the plan, such as the debtors' interest in the four "entities" — Baronwood, Countryside, Harmon, and R M Villas — which the plan specifies as the source for the payment of the 40% dividend to unsecured creditors.
It is true that the confirmed plan does not mention, let alone specifically dedicate to the payment of creditor claims, the debtors' equity in the Florida condominium. In a somewhat similar context, it has been held that after confirmation of a chapter 13 individual repayment plan, only property that is necessary to implement the confirmed plan remains property of the estate. In re Leavell, 190 B.R. 536, 540-42 (Bankr. E.D. Va. 1995) (St. John, J.) (holding that garnishment of debtor's wages by post-petition creditor after plan was confirmed did not violate the automatic stay when sufficient wages remained to make the required plan payments). Nevertheless, Leavell is not strictly analogous, since the claim at issue in that case arose post-confirmation and was not, as Sequoia's claim is here, provided for by the plan. Additionally, nothing in the confirmed plan in this case limits Class 8 unsecured creditors solely to the income from the DeLuca Entities for the payment of their claims. To the extent, therefore, that the debtors have equity in the Hillsboro Beach condominium, that equity is potentially available (and, indeed, may be necessary) for the payment of Class 8 claims.
III.
Sequoia argues, however, that even if the plan is read to restrict it from proceeding against property owned by the debtors on the confirmation date, such provision is unenforceable, because in the case of an individual debtor a chapter 11 plan can never limit the right of a creditor holding a nondischargeable claim to enforce that claim post-confirmation against property of the reorganized debtor. For this sweeping proposition, Sequoia relies on what it asserts is the plain language of § 1141, Bankruptcy Code, which provides in relevant part as follows:
(a) Except as provided in subsections (d)(2) and (d)(3) of this section, the provisions of a confirmed plan bind the debtor . . . and any creditor, . . . whether or not the claim or interest of such creditor . . . is impaired under the plan and whether or not such creditor . . . has accepted the plan.
* * *
(c) Except as provided in subsections (d)(2) and (d)(3) of this section and except as otherwise provided in the plan or in the order confirming the plan, after confirmation of a plan, the property dealt with by the plan is free and clear of all claims and interests of creditors . . .
(d)
* * *
(2) The confirmation of a plan does not discharge an individual debtor from any debt excepted from discharge under section 523 of this title.
(emphasis added).
Two cases are particularly relied on by Sequoia: In re Howell, 84 B.R. 834 (Bankr. M.D. Fla. 1988) and In re Amigoni, 109 B.R. 341 (Bankr. N.D.Ill. 1989). In Howell, the issue arose in the context of an objection to the debtors' disclosure statement. The objecting creditor, NCNB National Bank of Florida, had obtained a $21,266.98 judgment against the debtors that the bankruptcy court had determined was nondischargeable. The debtors then filed a modified plan which provided an additional modest monthly distribution on NCNB's claim, with the implied restriction that NCNB was precluded from collecting its claim outside the confirmed plan. The court refused to approve the disclosure statement because it found the plan itself could not be confirmed. In so ruling, the court held broadly that under § 1141(d)(2), Bankruptcy Code, a "creditor holding a nondischargeable debt is entitled to participate in any distribution made under a plan to similarly situated creditors and, in addition, such creditor may execute or collect on the balance of its nondischargeable debt without regard to the discharge provisions of the plan or the Code." Howell, 84 B.R. at 836.
In Amigoni, the issue similarly arose in the context of an objection to confirmation. The United States objected to debtors' plan, which proposed to pay certain restitution obligations arising from a criminal case — and which the sentencing court had required that the debtors use their "best efforts" to pay during the five year period of their probation — over a period exceeding twelve years. The court held that the plan could not be confirmed where the rights of the United States and parties entitled to restitution were curtailed by the plan. Amigoni, 109 B.R. at 341. The court specifically followed the reasoning set forth in Howell, holding that "[t]he authority cited above recognizes that parties to whom such debts are owed cannot have their rights under nonbankruptcy law restricted by a plan of reorganization. Accordingly, Debtors' proposed Plans are not confirmable because each Plan attempts to restrict the United States and the Class 4 Creditors to collection only as provided in the Plans. This would curb rights afforded these parties under the restitution order and 18 U.S.C. § 3663(h)." Id. at 345.
Other courts, however, have disagreed with the analysis in Howell and Amigoni. In In re Mercado, 124 B.R. 799 (Bankr. C.D. Cal 1991), the court ruled that while § 1141(d)(2) does not allow a plan to discharge an otherwise nondischargeable debt, the plan could properly enjoin a potential class of nondischargeable claims from executing on any judgment until a default occurred under the plan. Id. at 800. In support of this reading, Judge Ryan wrote, "Frankly, I disagree with the Howell court's approach of broadly applying § 1141(d)(2). An expansive interpretation is inconsistent with the statutory language and imposes unwarranted limitations on debtors seeking to reorganize under Chapter 11." Id. at 802. The plain language of the § 1141(d)(2) simply states that "confirmation of a plan does not discharge an individual debtor from any debt excepted from discharge under section 523 of this title." The Mercado court reasoned that § 1141(d)(2) merely preserves the right of creditors with nondischargeable debt to full payment, but does not bar a plan from otherwise affecting the rights of such a creditor where the restriction is necessary for a successful reorganization Id. at 801-02. In reaching this conclusion, the court noted that the "no-modification" view espoused in Howell was inconsistent with the Supreme Court's ruling in United States v. Energy Resources Co, Inc., 495 U.S. 545, 110 S.Ct 2139, 109 L.Ed.2d 580 (1990). The issue in Energy Resources was whether the bankruptcy court had the power to confirm a plan which required the IRS to apply plan payments first to trust fund taxes and then to other tax liabilities. The Supreme Court, in upholding the confirmation of the plan, held that a bankruptcy court has broad equitable power, within the constraints imposed by the Bankruptcy Code and other federal laws, to approve plan provisions necessary to the success of a reorganization.
I find the reasoning of Mercado more persuasive than that of Howell and Amigoni. Moreover, both Howell and Amigoni are procedurally and factually distinguishable from the present case. In both cases, the issue of plan treatment was raised prior to confirmation, and thus there was no issue as to the preclusive effect of plan confirmation. Likewise, both plans, while paying the nondischargeable claims in full, would have limited the affected creditors to the payment schedule provided in the plan and would not have allowed the creditor to reach, for example, after-acquired property. In the present case, by contrast, the plan has already been confirmed without objection by Sequoia, and the plan does not limit Sequoia's right to enforce its claim against post-petition income or assets.
In this respect, the present case is more like In re Martin, 150 B.R. 43, 46-47 (Bankr. S.D. Cal. 1993), in which the court held that the IRS, which had accepted the debtor's plan, was bound by terms and procedures in the confirmed plan with respect to its nondischargeable tax claims. In Martin, the IRS and debtors reached an agreement whereby the debtors would file their 1984-86 tax returns as a condition to the confirmation of the plan. The IRS would then have 90 days to file amended proof of claim, and debtor would have 180 days to object to the amended proof of claim. Subsequent to this agreement, the court confirmed the plan. Within the period prescribed by the agreement, the debtors filed their tax returns and the IRS then filed an amended proof of claim reflecting that no tax was due for those years. Roughly three years later, debtors received a Notice of Intent to Levy from the IRS for approximately $393,000 for the 1984-86 tax years.
The debtors then filed a motion to enjoin the IRS from violating the agreed plan. The IRS argued that its claims were nondischargeable, and therefore it was not bound by the plan. The court held in favor of the debtors, following the reasoning in Mercado. The opinion stated that "the IRS had full opportunity to participate in the plan process, and it chose to represent to the Court that it was satisfied with the agreed procedures for determining the amount of its nondischargeable claim[.] . . . The IRS has subjected itself to this Court's jurisdiction and should not be allowed to object at this late date and in this improper manner." Id. at 47.
In the present case, Sequoia had full opportunity to object to the plan proposed by the debtors and not only did not object, but affirmatively voted to accept the plan. The Fourth Circuit has recently affirmed in the context of a chapter 11 case the "firm and long standing" principle that a bankruptcy court order cannot be attacked collaterally unless it is based on the original court's lack of jurisdiction. Spartan Mills v. Bank of America Illinois, 112 F.3d 1251, 1255 (4th Cir. 1997), cert. denied 118 S.Ct. 417 (1997). Of course, the order here is being attacked in the issuing court, not another court, but the policy favoring finality applies with equal force, subject only to the provisions of F.R.Bankr.P. 9024 and of § 1144, Bankruptcy Code. Although Rule 9024 makes Fed.R.Civ.P. 60 applicable to bankruptcy cases, it contains the important limitation that a complaint to revoke confirmation of a plan may only be filed within the 180 day period after entry of the order of confirmation set forth in § 1144, Bankruptcy Code. Furthermore, § 1144 permits an order of confirmation to be revoked "if and only if such order was procured by fraud." The order confirming the debtor's plan was entered on the docket on September 19, 1997. The 180-day period for attacking the order of confirmation expired on March 18, 1998. The present motion by Sequoia was not filed until some two and a half months after the 180-day period expired. There can be little question, therefore, that Sequoia is bound by the plan and all of its provisions, including the restriction in § 2.12 that permits it to enforce its claim, to the extent not paid under the plan, only from property that was not property of the estate on the date the plan was confirmed.
Consistent with the holdings in Mercado and Martin, I read § 1141(d)(2) as merely maintaining the nondischargeability of the debt after confirmation, not as prohibiting any and all modification whatsoever of the rights of a creditor holding a nondischargeable claim. Such a reading is more consistent with the underlying rehabilitative goal of chapter 11 reorganization than the absolutist view espoused in Howell and Amigoni. There would be little reason to formulate and confirm a plan that attempted to provide the highest realistic dividend to the creditor body as a whole if a single creditor with a nondischargeable claim were potentially free to defeat the plan by executing upon the assets dealt with by the plan. Of course, any modification of the rights of a creditor holding a nondischargeable claim must be necessary to the plan's success and cannot be so broadly drawn as to effectively defeat the creditor's right to seek full payment of its claim. Had the question been raised and argued as an objection to confirmation, it is possible that I would have required, as a condition of confirmation, that the language of § 2.12 be amended so that the prohibition against enforcement outside the plan extended only to exempt property and to property specifically earmarked for the payment of claims under the plan. In this case, however, there was no objection to § 2.12, and Sequoia, having voted in favor of the plan, and not having appealed the order of confirmation, cannot now be heard to argue that the court should not have confirmed the plan, and that Sequoia should not be bound by it.
See In re Scott, 199 B.R. 586, 594-95 (Bankr. E.D. Va. 1996) (Under § 522(c) exempt property not subject to nondischargeable claim for willful conversion); Ewiak v. Ebner, 75 B.R. 211, 212-13 (Bankr. W.D. Pa. 1987) (debtor could avoid judicial lien on exempt property even though judgment was for a nondischargeable fraud debt). With respect to the Florida condominium, however, the DeLucas have claimed only $1 of the equity as exempt. It is well-settled in this District that an exemption claim of a nominal $1 with respect to an asset exempts only that amount and not the entire asset. In re Grablowsky, 149 B.R. 402, 405-06 (Bankr. E.D. Va. 1993), affdsub nom. Addison v. Reavis, 158 B.R. 53 (E.D. Va. 1993), affd sub nom. Ainslie v. Grablowsky (In re Grablowsky), 32 F.3d 562, 1994 WL 410995 (4th Cir. 1994) (unpublished disposition).
It is of course true that ambiguous plan language will be construed whenever possible so as to comport with, rather than contravene, an express provision of the Bankruptcy Code. In re Jankins, 184 B.R. 488, 492-93 (Bankr. E.D. Va. 1995) (construing a confirmed plan that was silent on payment of interest on priority tax claims to include a requirement for such interest). But nothing in Plan § 2.12 expressly contravenes any provision of the Bankruptcy Code. The portion of Sequoia's claim that is not paid under the plan is not discharged, and Sequoia is free to enforce its judgment against income earned, and assets acquired, post-confirmation. Unlike the plans in Howell and Amigoni, which provided for full payment but restricted the affected creditors holding nondischargeable claims to the payment schedule proposed by the debtors, this plan does not require Sequoia to wait until the plan is completed before looking elsewhere for the payment of the balance of its claim. Put another way, if the DeLucas win the Virginia lottery tomorrow, Sequoia will be free to enforce its judgment against those winnings. Thus, while Plan § 2.12 places limits on Sequoia's right to enforce its nondischargeable judgment, such limits do not undermine the essential nondischargeability of the claim and are not on their face prohibited by § 1141(d)(2), Bankruptcy Code.
IV.
In their amended response filed on August 18, 1998, the DeLucas complain that they had just learned that Sequoia had registered its judgment in Broward County, Florida under the Uniform Enforcement of Judgments Act, and they assert that "this action by Sequoia National Bank is a clear violation of the Debtors' confirmed plan and should be addressed by the court." In oral argument, counsel for the reorganized debtors referred to the amended response as a "cross-motion" to require Sequoia to release the judgment. It may be questioned whether a pleading, prepared by experienced counsel, captioned only as a response to a motion and not as a cross-motion, is properly characterized as a cross-motion simply because it includes a perfunctory prayer alleging that certain conduct by the opposing party "should be addressed by the court." On the other hand, it is true that a ruling — in connection with Sequoia's motion to register its judgment in other districts — on whether Sequoia can enforce its claim against the Florida real estate would be dispositive on the issue of whether Sequoia's action in docketing its judgment in Broward County violates the confirmed plan.
The basic problem, however, is that before the DeLucas would be entitled to an order requiring that Sequoia release any lien it might have obtained against the Hillsboro Beach condominium as a result of docketing the judgment, they would have to show that they were in compliance with the terms of the confirmed plan. A confirmed chapter 11 plan is in the nature of a novation. The debtor's prepetition liabilities are discharged and are replaced by the rights created by the plan. If a debtor defaults under a plan, the creditors whose claims are treated under the plan may sue on the plan in a non-bankruptcy forum and may enforce any judgment against property of the debtor (with the exception of exempt property, unless the debt is one of those which under § 522(c) may be enforced against exempt property). If this is true of the holder of a dischargeable claim, it is certainly true of the holder of a nondischargeable judgment. Some plans, indeed, have language that requires notice and an opportunity to cure before the debtor is deemed to be in default of the plan. The plan confirmed in the DeLucas' case, however, contains no such provision. Accordingly, if the debtors are in default, Sequoia would normally be free to enforce its nondischargeable judgment against any property of the debtors other than property that they exempted during the bankruptcy case.
In re Jankins, 184 B.R. 488, 494 (Bankr. E.D. Va. 1995) ("A confirmed plan of reorganization is in the nature of a novation, and the creditor who does not receive the payments promised under the plan is not required to seek relief in the bankruptcy court but may pursue its normal remedies with respect to the restructured debt.")
Under § 1141(c), the entry of an order of confirmation normally operates as a discharge. The plan in this case contained an unusual provision, the stated purpose of which was "to encourage confirmation" of the plan, under which the debtors agreed to defer their discharge "until such time as payment(s) required under this Plan are made in full to each creditor." Plan § 3.01. Thus, if a creditor in Class 8 did not receive the promised 40% dividend over five years, the debt would not be discharged and could be enforced for the full amount.
Confirmation of a plan terminates the automatic stay. U.S. Dept. of Air Force v. Carolina Parachute Corp., 907 F.2d 1469, 1474 (4th Cir. 1990). However, the discharge that normally results from plan confirmation under § 1141(d), Bankruptcy Code, itself creates an injunction against creditor action to enforce a discharged debt as a personal liability of the debtor. § 524(a)(2), Bankruptcy Code. A suit on a plan is not a suit to enforce a prepetition liability but rather to enforce a liability created by the plan. Such a suit is therefore not prohibited by § 524(a)(2).
A creditor who is not paid in accordance with the terms of a confirmed plan may also return to the bankruptcy court and seek, for example, an order under § 1142(b) enforcing the plan or an order dismissing the case under § 1112(b)(8) for material default with respect to the plan. However, in the absence of a "channeling" injunction in the order confirming the plan, such remedies are in addition to, and not in lieu of, the creditor's remedies under state law to enforce contractual rights created by the plan.
As discussed above, the plan provided that Sequoia, as the holder of a Class 8 claim, would receive payment of 40% of its claim in equal semi-annual installments over five years. The plan was confirmed on September 19, 1997, and the "effective date" of the plan was defined as the 11th day after entry of the order of confirmation. The effective date was thus September 30, 1997, and the first semi-annual installment would have been due on March 30, 1998. In connection with a motion filed by a different creditor to compel compliance with the plan, the debtors filed an accounting of payments made to date on allowed claims. That accounting reflects that only four creditors in Class 8 have received payments on account of their claims. Sequoia is not one of those. It would appear likely, therefore — although at this point the court makes no express ruling — that the debtors are in default of their obligations under the plan to pay Sequoia's Class 8 claim.
Sequoia has the burden of proof on its motion to show good cause for registration of its judgment in another district. But the reorganized debtors have the burden of proof on their "cross-motion" to compel release of Sequoia's judgment lien against the Hillsboro Beach condominium. The debtors, however, have offered no evidence to show that they are in fact in compliance with the terms of the confirmed plan. In the absence of such a showing, the court is not prepared to order the relief sought by the debtors.
Since Sequoia did not raise the issue of plan default and did not offer any evidence of such default, the court will likewise not grant the relief requested by Sequoia.
V.
A separate order will be entered denying Sequoia's motion to register the judgment and the debtor's cross-motion to compel release of the judgment.