By Marcy Ford and Kim Rattet
Effective February 1, 2016, Local Bankruptcy Rules for the Eastern District of Michigan were extensively amended. Several substantive changes that directly impact local practice in consumer bankruptcy cases include the following highlights; however, for a full breakdown of changes, please contact Marcy Ford [1] at [email protected] or Kim Rattet [2] at [email protected].
General Requirements
- All transfers of claim must include the claim number (E.D. Mich. L.B.R. 3001-1).
- Stipulations for Relief From the Automatic Stay (E.D. Mich. L.B.R. 4001-1) must be signed by all interested parties (i.e., the Debtor, Trustee and any other party with an interest in the property) or a Motion to approve the stipulation must be filed. As a result, there will be no advantage in terms of the time frames to file a motion for relief vs. a stipulation.
- There is now an established procedure for Ex-Parte Motions seeking to redact protected private information. Under E.D. Mich. L.B.R. 9037, access to the pleading will be restricted while the motion is pending. A properly redacted replacement document must be filed within 7 days of the motion being granted.
Chapter 7
- Reaffirmation agreement coversheets. E.D. Mich. L.B.R. 4008-1 requires that a reaffirmation agreement be accompanied by a coversheet, Offical Form B427. A copy may be found here [3].
Chapter 11
- Where the Debtor has filed a combined plan and disclosure statement, the deadline for an 111(b) election is 7 days prior to the first scheduled date of the confirmation hearing (E.D. Mich. L.B.R. 3014-1).
Chapter 13
- Procedures upon Chapter 13 Plan Completion (E.D. Mich. L.B.R. 2015-3)
- Section (a)(3) previously, included language in the discharge order that “any pre-petition or post-petition defaults have been cured and the claim is in all respects current, with no escrow balance, late charges, costs or attorney fees owing.” That language has been changed to read only that “any pre-petition or post-petition defaults have been cured.”
- Section (a)(7) that provides the debtor is not discharged from any obligation on any continuing secured debt payments that came due after the last contractually due payment to which the trustee’s last disbursement is applied.
- E.D. Mich. L.B.R. 2015-3(a)(4) clarifies that the requirement of a response to a notice of final cure under F.R. Bankr. P. 3002.1 no longer applies where the stay has been terminated as to a creditor.
- Payment changes (E.D. Mich. L.B.R. 3001-2(d)) was added that allows for a Notice of Inability to Comply with Timing Requirements. This applies to a creditor whose claim is secured by a mortgage for which the amount of the debtor’s payment obligation is subject to change more frequently than once every 60 days. Such a creditor may file a “Notice of Inability To Comply With Local Rule 3001-2(a) Deadline” as an attachment to any statement of proposed payment change filed under subpart (a) of this Local Rule. Upon the filing of a notice under this subpart (d), unless there is an objection filed within 14 days or the court orders otherwise, the trustee must effectuate the payment change stated in the notice of payment change rather than 21 days after service of the notice.
- Any pre- or post-petition plan that provides for surrender of property (E.D. Mich. L.B.R. 3015-1 and 3015-2) must include a statement that the requirements of Local Rule 3001-2 are terminated upon confirmation of the plan and that the co-debtor stay, as applicable, must be terminated.