Author Archive for Holly Thurman

Federal Rules of Bankruptcy Procedure Amended December 1, 2009

Published
by
Holly Thurman
on February 10, 2010
in Appendix, Bankruptcy Automatic Stay, Briefs, Computing time, Federal Rules of Bankruptcy Procedure, Motion and Notice of Appeal
. 0 Comments

By: Holly C. Thurman, Associate

The Federal Rules of Bankruptcy Procedure were amended effective December 1, 2009.  Throughout the rules, the deadlines and time periods that have been amended are modified in the following manner:

∙ 5 day periods become 7 day periods
∙ 10 day periods become 14 day periods
∙ 15 day periods become 14 day periods
∙ 20 day periods become 21 day periods
∙ 25 day periods become 28 day periods

The following revised rules are the most frequently referred to timelines and deadlines in creditor bankruptcy practice:

1) Stay of Order Granting Relief from the Automatic Stay: An order granting a
motion for relief from an automatic stay is stayed until the expiration of 14 days after the entry of the order. Formally, relief from stay wasn’t effective for 10 days from the date of the order and the amendments have extended that time period to 14 days.

 2)   Time for Filing Notice of Appeal: The notice of appeal shall be filed with the clerk within 14 days of the date of entry of the judgment, order, or decree appealed from. Formally, the appellant had 10 days from the date of entry of the order to appeal.

 3)   Briefs and Appendix; Filing and Service: Unless the district court or the bankruptcy appellate panel by local rule or by order excuses the filing of briefs or specifies a different time limit, the appellant shall serve and file a brief within 14 days after entry of the appeal on the docket. Appellant formally had 15 days to file a brief from the date of the entry of the appeal on the docket.

 4)    Computing time: Per the amendments, when computing time periods, the moving party is to count everyday, including intermediate Saturdays, Sundays, and legal holidays. The former rules required we exclude those days when computing time periods and deadlines. 

 5)   Computing and Extending time for Motions—Affidavits: A motion and notice of hearing must be served no later than 7 days before the time specified for such hearing, unless a different period is fixed by these rules or by an order of the court. The rules formally required that the motion and notice of hearing be served 5 days prior to the specified hearing, unless the court specified otherwise. Most Courts specify a time to serve the notice that is earlier than 7 days prior to the hearing, and usually the Courts require the notice to be served immediately upon receipt.

These changes impact deadlines used in everyday practice. Creditors must be aware of the new timelines and guidelines and use them to effectively administrate orders and other notices issued by the Court.
  
Holly C. Thurman is an Associate in the Bankruptcy department of the Pittsburgh office. She can be reached at (412) 338-7105 or hthurman@weltman.com.

Procedure for Filing Notice of Mortgage Payment Change Amended in Western District of Pennsylvania

Published
by
Holly Thurman
on November 17, 2009
in Chapter 13, Local Procedures & Rules and Real Estate
. 0 Comments

Effective January 1, 2010, the Western District of Pennsylvania Court Procedure will change regarding notifying the Court and the Debtor of monthly mortgage payment changes. The Chapter 13 Trustee is the acting disbursing agent for ongoing mortgage payments in this district.

Notice of Mortgage Payment Change must be filed with the Court at least twenty-one (21) days prior to the date that the change is to become effective or the Creditor is forever barred from collecting the difference in the change. In order to comply with this deadline, your attorney will need the information and documents as soon as possible after the escrow changes or the interest rate changes.

The Notice of Mortgage Payment Change must include:

  • A complete and accurate loan payment history;
  • A computation of the payment change “in a format which is readably understandable by the Court and the Parties-in-Interest;” and
  • A declaration under penalty of perjury by a competent official of the Creditor substantiating the veracity and accuracy of the requested change 

The Notice can no longer simply state what the monthly payment is and the effective date, rather, we will have to compute and accumulate detailed information justifying the change.

If a loan is transferred or sold, the procedure will now require the new owner to file a copy of any applicable lien assignment evidencing the Creditor’s alleged right to payment if the Creditor is not currently a Creditor “of record”. The assignment must also include, on a separate page, a narrative summary of the chain of title evidencing the Creditor’s authority to act and be paid.

After a Notice of Mortgage Payment Change is filed, the Court will issue a standard order requiring the debtor to:

  • Amend the chapter 13 plan;
  • File a declaration that the existing chapter 13 plan is sufficient to fund the plan with the modified debt; or
  • File an objection to the Notice of Mortgage Payment Change as stated and the Court will schedule a hearing on the matter

If a Declaration is filed by the debtor that the monthly plan payment doesn’t need to change, we recommend a review of the Chapter 13 Trustee’s website to be sure that the changed monthly payment amount is disbursed. If an Objection to the Notice of Mortgage Payment Change is filed, additional documentation may be necessary to defend the Notice of Mortgage Payment Change.

If lenders want to be paid post petition fees, expenses or charges, then within 180 days from the date incurred, lenders must file a Notice of Post-Petition Fees, Expenses and Charges. Examples of fees incurred post petition are attorney fees, BPO fees, property inspections and other administrative fees. The notice must include an itemized list of the fees and expenses and when they were incurred. The Court will issue a standard Order giving the Debtor twenty-one (21) days to amend the plan, file a declaration, or object to the Notice.

Lenders must now be very diligent in administering loans secured by real estate and file the required notices with the court on a timely basis, or they will be barred from collecting increases in payments and other expenses. WWR is continuing to monitor these developments and will advise you as procedures change so that you can take the steps necessary to protect yourself while the debtor is in bankruptcy. 

The Administrative Order implementing this new procedure can be found on the Western District of Pennsylvania Bankruptcy Court’s website at http://www.pawb.uscourts.gov.

If you have any questions regarding this client advisory, please contact Ms. Holly C. Thurman, Esq. Holly is an associate in the bankruptcy department within the Real Estate Default Group of Weltman, Weinberg & Reis Co., L.P.A., and is located in the Pittsburgh office. She can be reached directly at 412.338.7105 or via e-mail at hthurman@weltman.com.