Recent Entries

Bankruptcy Forms to Change December 1st

KCSBy Keri P. EbeckPartner

As of December 1, 2015, the United States Bankruptcy Courts will mandate usage and filing of the forms approved at the Judicial Conference in September 2015. Although many of the official bankruptcy forms will change, those effecting lenders and creditors directly include: proof of claims, mortgage attachment (also known as 410A form), notice of payment change, notice of post petition expenses and the reaffirmation agreement cover page.

Lenders and creditors should be aware that after December 1, 2015, the old forms will not be accepted and the Courts will require usage of the new forms. Most importantly is that creditors, prior to December 1, 2015 should review the new forms and their requirements, which can be found at The new proof of claim and the mortgage attachment (Form 410A) have significant changes and require substantially more information to complete as compared to the old forms, and therefore, prior review is recommended.

Upon review of the new forms, if there are specific questions or concerns with completing the new forms, creditors should seek the advice of counsel to discuss.

If you have any questions, please contact Keri P. Ebeck, Esq. Keri practices in Bankruptcy and is located in the Pittsburgh office. She can be reached at 412.338.7102 and

Filing Motions of Sanctions by Debtors

JJLBy Jon Lieberman, Attorney

The filing of motions for sanctions by debtors, for alleged creditor stay violations seems to have increased in volume as of late. Michigan creditor counsel have successfully used two recent Sixth Circuit cases to reiterate the duty of debtors and/or their counsel to mitigate their damages before seeking sanctions for such alleged violations.

In Schang v. Muller, Muller, Richmond, Harms & Myers, P.C., 2015 WL 3441178 (E.D. Mi. 2015), the Court ruled that the Debtor has a duty to mitigate harm before seeking sanctions for creditor’s violation of stay. Three days after debtor filed for bankruptcy protection, creditor (without knowledge of case) sent collection letter. Debtor and Debtor’s counsel made no effort to contact creditor or creditor’s counsel to advise of bankruptcy filing. One month later, creditor issued second collection letter and debtor sought sanctions. Debtor could have taken minimal steps after receiving first letter that likely would have prevented second letter. Debtor’s failure to take simple steps that would have caused creditor to cease collection efforts constituted failure to mitigate. Request for sanctions denied.

In In re Phillips, 2015 WL 4256641 (Bankr. E.D. Tn. 2015), creditor violated the stay by contacting debtor and relatives of debtor 22 times post-petition before ceasing efforts. However, at no time did debtor advise creditor of bankruptcy filing until debtor filed motion for sanctions, at which point creditor immediately ceased collection efforts. Debtor’s counsel intentionally mailed creditor a blank sheet of paper by certified mail to confirm address was correct on prior notices, but did not make any effort in that mailing or in response to a phone call from creditor (in response to the blank sheet of paper) to advise creditor of bankruptcy. Sanctions must be proximately caused by violation of stay. If litigation is unnecessary to afford debtor a complete remedy, then fees for commencing and prosecuting action are not compensable.

Creditors: Be Aware of Important Changes on the Horizon for Bankruptcy Forms

JMCBy: Joseph McCandlish, Attorney

The forms for proofs of claim are changing again in December of 2015. As you might expect (rather than as you might hope), substantially more detail will be required. This is especially so for mortgage proofs of claim.

The good news is that there is an official two-page instruction form for the proof of claim, and an official three-page instruction form for the mortgage attachment. As indicated by the proposed forms, additional detail should be listed, for each payment received. I have included a link to this article. [1]

Again, we anticipate that the forms will be approved for use beginning December, 2015. We recommend meeting with your bankruptcy attorney ahead of time, rather than figuring out how to produce the additional information while under the pressure of a deadline that is approaching.

To schedule a time to meet, or if you have any questions about the new forms, feel free to contact me here.


[1] Source:, “Pending Official Bankruptcy Forms and Committee Notes”, pages 241-245

Timeline of Chapter 7 Bankruptcy Case

Anne Smith_grayBy: Anne Smith, Attorney

Over the years, I’ve been asked by clients how long a bankruptcy case will last. As a former debtor’s attorney, and now as a creditor’s attorney, I am still asked this question. Below is a general summary of the timeline for a chapter 7 bankruptcy case – keep in mind that many factors can alter this timeline, and this should be viewed only as a guideline.

A Chapter 7 bankruptcy case begins once a Petition is filed with the Bankruptcy Court. The debtor’s petition includes Schedules listing assets, creditors, income, expenses, executory contracts, leases, and co-debtors. The Schedules are usually, but not always, filed at the same time as the Petition. Other supporting documents, such as the Declaration Regarding Payment Advices and Credit Counseling Certificate, along with the filing fee, are also typically filed together with the Petition.

Immediately: The automatic stay order is issued immediately upon filing. This stops all actions that affect the debtor, his/her income or assets of the bankruptcy estate. Garnishments on bank accounts and paychecks, and lawsuits or foreclosure actions are halted once creditors are notified of the bankruptcy filing. A Trustee will be assigned to the bankruptcy case.

Two weeks after filing: The Bankruptcy Clerk will mail creditors the Notice of Chapter 7 Bankruptcy Case, Meeting of Creditors, & Deadlines, which provides the date set for the meeting of creditors and other important deadlines. Many districts indicate whether a creditor should or should not file a Proof of Claim at that time.

Within 30 days of filing: Debtor must file a Statement of Intention, if not already filed with the petition, informing the court if he/she plans to keep or surrender any collateral property.

Approximately 4 weeks after filing: The Meeting of Creditors, often referred to as the 341 meeting, will be held. Creditors may attend and are permitted to ask questions of the debtor, usually about disposition of collateral, valuation or reaffirmation plans.

30 days after the 341 Meeting: Deadline for the Bankruptcy Trustee or creditors to object to any exemption claims. Debtor will need to surrender the property, reaffirm the debt, or redeem property for the allowed secured claim, as indicated in the debtor’s Statement of Intent. Anticipate additional pleadings, e.g. reaffirmation agreement, motion to redeem.

60 days after 341 Meeting: Creditors must object to discharge of debts that were obtained by false pretenses, a false representation, or actual fraud; debt from fraud or defalcation while acting in a fiduciary capacity, embezzlement or larceny; and debt for willful and malicious injury. This deadline applies to objections to discharge of: consumer debts owed to a single creditor of more than $500 for luxury goods or services obtained within 90 days before a Chapter 7 bankruptcy, or cash advances totaling $750 or more within 70 days prior. Creditors may also object to discharge of debts involving misconduct, including transfer, destruction or concealment of property; concealment, destruction, falsification or failure to keep financial records; making false statements; withholding information; failing to explain losses; failure to respond to material questions; or having received a discharge in a prior bankruptcy case filed within the last 6 years. In most jurisdictions, the deadline for objection to discharge will be clearly set out in the Notice deadlines issued by the clerk to creditors early in the case. However, if a specific date is not set for filing of the objection, then the deadline is sixty days after the first date set for the 341 meeting of creditors. An adversary proceeding is required to determine the non-dischargeability of a debt.

More than 60 days after 341 Meeting: Debtor’s discharge will be issued by the Bankruptcy Clerk. However, at this point in time, the discharge is not absolute or final. The trustee can ask that the discharge be set aside if the debtor does not turn over non-exempt property, if the debtor fails to perform other duties, or if there were other matters pending which would result in the denial of the discharge. Because the discharge is not completely final at this point, we often counsel our clients to wait until the case is closed before taking any action without relief from stay.

If assets are found available for liquidation to pay creditors, the Trustee will issue a notice for creditors to file Proofs of Claim and will provide a deadline to do so, if creditors wish to share in the payments from debtor’s bankruptcy case.

At some point around the six-month mark, a Discharge will be entered by the Court, and the case will be officially closed. If the Trustee is liquidating non-exempt assets, the bankruptcy case will remain open to allow the Trustee to distribute the funds to creditors and file a final report.

Caveat: Any number of reasons or events, or even local rules of the courts, may affect this timeline. Contact your legal counsel for further information.

Secured Creditors Must File Timely Proofs of Claims to be Paid: Seventh Circuit

M_Cope_Blogby Monette CopeJunior Partner

The Seventh Circuit (1) just issued an opinion holding that if secured creditors wish to participate in Chapter 13 bankruptcy plan distributions, they must not only file a secured proof of claim, but also file it in a timely manner.(2) Up until now, it was widely held that the proof of claims deadline only applied to unsecured claims.(3)

This is especially important in the Northern District of Illinois because the practice has been that if a secured creditor was provided for in the plan with monthly payments from the Chapter 13 trustee, that creditor did not need to file a claim to get paid. Read more here.