In a continuing effort to provide the bar with feedback on developments or trends observed since the enactment of the Reform Act, Judge Waites offers the following.
The Court would call your attention to recent problems arising in cases filed under the provisions of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005:
- With respect to jointly filed individual cases, there have been numerous instances where counsel for debtors have failed to file a certificate of credit counseling for each of the co-debtors despite the fact that they both properly completed credit counseling pre-petition. Failure to properly file a certificate of credit counseling may cause the dismissal of the case.
- The portions of Schedules I and J that describe any anticipated increase or decrease in income or expenditures (or a lack thereof) are often left incomplete. These matters are monitored by the Clerk’s office. Failure to file completed Schedules may result in dismissal of a case.
- With respect to Motions to Extend Stay, the Court has observed that counsel for debtors are not always aware of the latest developments regarding debtors’ employment. Schedules, particularly those relating to income and expenses, should be reviewed and amended prior to the hearing. Furthermore, debtors without sufficient financial means to fund a plan (deficit budgets) may not be able to carry their burden of proof in order to have the stay extended, unless those debtors can show significant equity in their real property, and consent to conversion of their case to Chapter 7 in the event their Chapter 13 fails. Finally, in the event the Court is inclined to extend the stay, counsel for debtors should be prepared to e-mail an order that grants the extension in a form which conforms to the language used in prior orders listed on the Court’s website.
- The Court is receiving increasing numbers of motions for an order confirming termination of stay pursuant to 11 U.S.C. § 521(a)(6), in which the debtor fails to perform their statement of intent. To demonstrate the existence of such facts, the motion should be accompanied by an affidavit detailing the facts in support. The Court may be unable to issue an order without such affidavit.
We hope this information is helpful to the bar.