Elmer and Elsie Fobian appeal from the decision of the Bankruptcy Appellate Panel (“BAP”) reversing the bankruptcy court’s confirmation of their chapter 12 plan. They argue that the BAP erred in holding that the plan could not be confirmed because it did not meet the requirements of Section 1225 of the Bankruptcy Code. The Bank argues for affirmance of the BAP’s decision, and asks that we award it attorneys’ fees and costs.

We affirm the BAP’s decision, but award the Bank only costs on appeal.

BACKGROUND

The Fobians are solvent Chapter 12 debtors. They are current on all obligations except a loan from the Bank. The Bank holds a promissory note secured by 70.5 acres of land located in Glenn County, California and stock in the Federal Land Bank Association of Northern California. After the Fobians filed their Chapter 12 petition, the Bank filed a Proof of Claim for $191,-660.09. The Proof of Claim stated: “No security interest is held for this claim except Deed of Trust. Stock in FLBA of Northern California perfected pursuant to the Farm Credit Act of 1971.” The Fobi-ans made no objections to this Proof of Claim.

While the Fobians filed three plans, only the “First Amended Plan for Reorganization under Chapter 12” (the “Plan”) was submitted for confirmation. The Bank filed objections to the plan and a confirmation hearing was held on June 27, 1989.

The Plan provided for treatment of the Bank’s claim as follows:

The Bank did not elect either alternative. The Fobians then elected the second alternative, surrender of the property.

The Bank objected to confirmation of the Plan on the grounds that the plan did not take into consideration the unsecured portion of the Bank’s claim, and did not comply with the requirements of Section 1225(a)(4). The Bankruptcy Court nonetheless confirmed the Plan in a Memorandum Opinion and Order Including Findings of Fact and Conclusions of Law filed on August 7, 1989.

The BAP reversed, holding that because the Plan did not meet the requirements of Section 1225, it could not be confirmed.

STANDARD OF REVIEW

We review a bankruptcy court’s conclusions of law de novo. Findings of fact are upheld unless they are clearly erroneous. Rubin v. West (In re Rubin), 875 F.2d 755, 758 (9th Cir.1989).

DISCUSSION

Because the Plan fails to comply in several ways with Section 1225, the BAP was correct in reversing the bankruptcy court’s confirmation. We now analyze in some detail the treatment of the Bank’s claim by the bankruptcy court and the Plan.

I. Section 506

In confirming the plan, the bankruptcy court stated that at the time of confirmation the extent to which the bank was secured was “uncertain.” The bankruptcy court found that “it is clear that BANK has not yet become an unsecured creditor.” Thus, the Bank could not invoke the protections Section 1225 provides for such claims. Looking in particular to description of the Bank’s claim in the Plan itself, the BAP found that the bankruptcy court had erred in holding that the Bank held only a secured claim. The BAP was correct in this holding.

The BAP cited Section 506, which provides:

11 U.S.C. § 506 (a). Section 506 required the bankruptcy court to determine whether the bank was both a secured and an unsecured creditor. Without doing so, the court could not apply the tests of Section 1225 to the plan.

II. Section 1225(a)(5)

The Fobians argue that the Bank has no unsecured claim under the plan as the Bank was offered the option of receiving the property securing its claim in full satisfaction of that claim. In support of this argument, the Fobians invoke Section 1225(a)(5), which provides:

11 U.S.C. § 1225 (a)(5).

As the Fobians note, cases have acknowledged the “theoretical possibility” of a surrender of property in satisfaction of a secured debt; however, such cases have also recognized that such a solution is unworkable in practical terms. Absent the provision of some additional protection to the creditor, it is impossible to ensure that the creditor will receive the full amount to which it is entitled, and only that amount. Surrender of the property may satisfy the secured claim. However, if the value of the property is less than the amount of the claim, the creditor may retain an unsecured claim for the difference. If the value of the property surrendered turns out to exceed the amount of the claim, the secured creditor receives a surplus to which it is not entitled. Thus, the court in In re Durr rejected a plan which provided for the transfer of real property in satisfaction of a secured claim. The Durr court noted that a plan “proposing a payment with tangible property” must provide both for a “surplus of value” or for a “margin of allowance” to ensure that the creditor received full value, and for a means of recapturing excess value the creditor might realize on disposition of the collateral. In re Durr, 78 B.R. 221, 225 (Bankr.D.S.D.1987). Because the plan at issue made no such provisions, it could not be confirmed. Id.; see also In re Indreland, 11 B.R. 268, 274 (Bankr.D.Mont.1987) (approving plan which provided for transfer of property to secured creditor where the debtor had submitted a 5 year plan, and the creditor could return to the court for “redetermination of its claim” if it failed to realize the value of its claim on sale of the collateral).

In this case, the debtor’s plan provides for neither the safeguards required by Durr nor the possibility of redetermination present in Indreland. While Section 1225(a)(5) would extinguish the Bank’s claim to the extent it was secured, the unsecured portion would survive.

III. Section 1225(a)(4)

Section 1225(a)(4) provides:

11 U.S.C. § 1225 (a)(4).

Here, all parties acknowledged that the debtor had substantial net worth. Thus, in a chapter 7 liquidation, the Bank would be paid in full. However, the Plan makes no provision for the unsecured portion of the Bank’s claim. Therefore, the Plan does not meet the requirements of Section 1225(a)(4). The BAP was correct in reversing confirmation for this reason.

IV. Section 1225(b)

Section 1225(b) provides:

11 U.S.C. § 1225 (b)(1).

Section 1225(b) does not provide an alternative to compliance with Section 1225(a); rather, each subsection must be satisfied independently. In re Willingham, 83 B.R. 552, 553 (Bankr.S.D.Ill.1988).

Here, the Plan provides for no payment to the Bank in satisfaction of its unsecured claim. It also fails to provide for any portion of the Fobians’ income to be applied to payments to the Bank. Thus, the Plan fails to meet the requirements of Section 1225(b). The BAP was correct in reversing confirmation on these grounds.

Y. Award of Attorneys’ Fees and Costs to the Bank

The Bank asks for an award of attorneys’ fees and costs. It cites provisions in the promissory note and the deed of trust executed in relation to the loan which provide for the payment of fees and costs incurred in collection of amounts due or enforcement of rights.

A. Costs on Appeal

Bankruptcy Rule 8014 provides, in relevant part: “Except as otherwise provided by law, agreed to by the parties or ordered by the district court or bankruptcy appellate panel, costs shall be taxed against the losing party on appeal.” Bankruptcy Rule 8014. Thus, we award the Bank its costs on its appeals before the BAP and before this court.

B. Attorneys’Fees at all levels; Costs in the Bankruptcy Court

Where a contract or statute provides for an award of attorneys’ fees, a creditor may be entitled to such fees in bankruptcy proceedings. Such an award is governed by state law. Collingwood Grain, Inc. v. Coast Trading Co. (In re Coast Trading Co.), 744 F.2d 686, 693 (9th Cir.1984); Merced Production Credit Ass’n v. Sparkman (In re Sparkman), 703 F.2d 1097, 1099 (9th Cir.1983).

However, where the litigated issues involve not basic contract enforcement questions, but issues peculiar to federal bankruptcy law, attorney’s fees will not be awarded absent bad faith or harassment by the losing party. Coast Trading, 744 F.2d at 693 (refusing to award fees where creditor brought a nondischargeability action); Grove v. Fulwiler (In re Fulwiler), 624 F.2d 908, 910 (9th Cir.1980) (refusing to award fees for creditor’s action under Section 546); see also Johnson v. Righetti (In re Johnson), 756 F.2d 738, 741-42 (9th Cir.1985) (because creditor’s request for relief from the automatic stay pursuant to Section 362(d) was not an “action on the contract,” debtor was not entitled to attorneys’ fees for defense against the request).

Here, litigation involved solely issues of federal bankruptcy law: the Bank sought proper application of Sections 506 and 1225. This was not a traditional “action on the contract.” “[T]he question of the applicability of the bankruptcy laws to particular contracts is not a question of the enforceability of a contract but rather involves a unique, separate area of federal law.” Coast Trading, 744 F.2d at 693 . Thus, we decline to award the Bank attorneys’ fees for its litigation of this case at all levels, and limit the award of costs to costs incurred on appeal.

AFFIRMED.

. Unless otherwise stated, all references to “sections" refer to the Bankruptcy Code, 11 U.S.C. § 101 et seq.