The following excerpt is from Star Phoenix Min. Co. v. West Bank One, 147 F.3d 1145 (9th Cir. 1998):
2 In a typical Chapter 11 proceeding, the confirmation of the reorganization plan discharges the debtor of any debt that arose prior to the confirmation. 11 U.S.C. 1141(d)(1). That "discharge" does not result in the extinguishment of the underlying debt but merely releases the debtor from personal liability. Matter of Edgeworth, 993 F.2d 51, 53 (5th Cir.1993). It is also well-established that the discharge of the principal debtor in bankruptcy will not discharge the liabilities of codebtors or guarantors. See 11 U.S.C. 524(e); Underhill v. Royal, 769 F.2d 1426, 1432 (9th Cir.1985). This court has held that, under Section 524(e), a bankruptcy court does not have the power to discharge the liabilities of a bankrupt's guarantor. Underhill, 769 F.2d at 1432.
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