Debtor With No Plan to Engage in Farming Operation Was Not Eligible For Chapter 12 Bankruptcy Protection.

The debtor filed a Chapter 12 bankruptcy petition and claimed that he had been a rice farmer from 1976 until 2010 when he became disabled. His sole income for 2011 and 2013 was social security, and he received $30,668.04 in 2012 as a settlement from Bayer CropScience for crop losses sustained in 2006, 2007, and 2008. The trustee filed a motion to dismiss or convert on the grounds that the debtor was ineligible for Chapter 12 relief under 11 U.S.C. § 109(f). The court granted the motion, finding that the debtor was not engaged in a farming operation, as was required to qualify for Chapter 12 relief. He did not satisfy the seven-factor “totality of the circumstances” test required to be “engaged in a farming operation.” None of the debtor’s family members resided on the farm, he was not involved in the process of growing or developing crops or livestock, he did not provide any service or product, and (most importantly) he was not subject to the inherent risks of farming. He expressed no interest in salvaging his rice farm operation or otherwise engaging in a farming operation in the future. His purpose in filing for bankruptcy protection was “to get out of debt.” As such, he was not eligible for Chapter 12 relief. In Re McLawchlin, No: 13-37887, 2014 Bankr. LEXIS 2455 (S.D. Tex. Bankr. June 5, 2014).    

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