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Bankruptcy Rule Changes: What You Need to Know

Nearly every year, there are changes to the Federal Rules of Bankruptcy Procedure. 2017 was no exception, and new rules went into effect on December 1, 2017. Creditors should be aware of the new timeframe for filing claims and new relief that can be sought in Chapter 12 and Chapter 13 plans. Below is a summary of some of the new rule changes.

Rule 3002—Filing a Proof of Claim or Interest

  • The time to file a proof of claim has been shortened in Chapter 7, 12, and 13 cases. Instead of having 90 days from the first date set for the meeting of creditors, claimants will now have 70 days from the order for relief to file their claims in voluntary Chapter 7, 12, or 13 cases. Creditors will have 90 days from the order for relief to file their claims in involuntary Chapter 7 cases.
  • Secured creditors must file proofs of claim to have allowed claims. Failure to file a proof of claim will not impact a secured creditor’s lien.

Rule 3007—Objections to Claims

  • Rule 3007 was amended to clarify that, for most claimants, objections to proofs of claim shall be served by first class mail to the address designated on the proof of claim. If the objection is to a claim of the United States or its officers or agencies, the rules for serving a summons and complaint under Rule 7004 apply. If the objection is to a claim of an insured depository institution, the objection must be served by certified mail addressed to an officer of the institution (assuming no attorney has entered an appearance) in compliance with Rule 7004(h).
  • Rule 3007 was also revised to specify that a hearing does not need to be scheduled on every objection. Rather, there only needs to be opportunity for a hearing.

Rules 3012—Determining the Amount of Secured and Priority Claims

  • Before the rule change, Rule 3012 permitted an interested party to file a motion to determine the amount of a secured claim. Under the revised rule, a party may also seek a determination for the priority of a claim. This determination may be made by motion, in a claim objection, or in a Chapter 12 or Chapter 13 plan. If a secured claim of a governmental unit is involved, the determination may be made only by motion or claim objection.

Rule 3015—Filing, Objection to Confirmation, Effect of Confirmation, and Modification of a Plan in a Chapter 12 or a Chapter 13 Case

  • There is a new official form Chapter 13 plan. The official form must be used, unless a local form that complies with new Rule 3015.1 has been adopted.

Rule 4003—Exemptions

  • A debtor may now request to avoid liens on exempt property in a Chapter 12 or Chapter 13 plan.

Rule 5009—Closing Chapter 7, Chapter 12, Chapter 13, and Chapter 15 Cases; Order Declaring Lien Satisfied

  • A Chapter 12 or Chapter 13 debtor may request an order declaring that a secured claim has been satisfied under the terms of a confirmed plan.

Rule 9009—Forms

  • Parties must use official forms. Parties may only make minor alterations to the official forms, such as expanding the space for completing response or deleting spaces that are not necessary.

The full text of all the amended bankruptcy rules can be found at http://www.uscourts.gov/rules-policies/current-rules-practice-procedure.

This blog post was drafted by Andrea Chase, an attorney in the Spencer Fane LLP Kansas City, MO office. For more information, visit spencerfane.com.