United States Courts
Western district of Missouri
Bankruptcy Court Highlights
Some of the amendments are technical or conforming in nature, but others create new filing periods or amend filing requirements. Changes to the rules and forms are summarized below:
Bankruptcy Rule 1007 shortens time for debtor to file a list of creditors after the entry of an order for relief in an involuntary case to seven days and extends time for individual Chapter 7 debtors to file statement of completion of course in personal financial management to 60 days after the first date set for the meeting of creditors. Please note that 2010 Standing Order No. 1, adopted by the Western District of Missouri Bankruptcy Court en banc, extends the deadline to file the list of creditors in an involuntary case to 14 days.
Bankruptcy Rule 1014 extends the authority of the court to determine where cases should go forward when multiple petitions involving the same debtor are pending to include Chapter 15 cases.
Bankruptcy Rule 1015 extends the authority of the court to order consolidation or joint administration of cases to include Chapter 15 cases.
Bankruptcy Rule 1018 modified to reflect enactment of Chapter 15 in 2005.
Bankruptcy Rule 1019 creates, with some exceptions, a new time period to object to a claim of exemption arises when a case is converted to Chapter 7 from Chapter 11, 12 or 13.
Bankruptcy Rule 4001 modified to conform to 2009 time-computation amendments.
Bankruptcy Rule 4004 is amended to include a new deadline for filing of motions (rather than complaints) objecting to a debtor’s discharge when the reason is due to a prior case filing. In addition, the rules clarify that the court shall withhold a discharge in Chapter 11 and 13 cases if the debtor has not filed a statement of completion of a course concerning personal financial management.
Bankruptcy Rule 5009 is amended to require the clerk to provide notice to individual debtors in Chapter 7 and 13 cases that their cases may be closed if they fail to file a statement of completion of financial management course. This will not seem new to attorneys filing in the Western District of Missouri, as the court has been issuing such notices since 2001.
Bankruptcy Rule 5012 is created to establish procedures for coordinating proceedings among cases pending in other countries that involve the Chapter 15 debtor.
Bankruptcy Rule 7001 is amended to cross-reference the new procedure created in Rule 4004 to file certain types of objections to discharge by motion rather than by complaint.
Bankruptcy Rule 9001 is amended to add § 1502 to the list of definitions.
Official Forms 9A, 9C and 9I contain technical changes that conform to the amendments to Bankruptcy Rules 4004 and 7001.
Official Forms 20A and 20B contain technical and conforming amendments.
Official Forms 22A, 22B and 22C. Forms 22A, 22B and 22C instruct that only one joint filer should report payments by another for household expenses. Forms 22A and 22C are amended to delete references to “household” and “household size,” and are replaced by “number of persons” or “family size.” Finally, Form 22A directs debtors in joint cases to file separate forms only if one of the debtors is entitled to a Part I exemption.
The Attorney Advisory Committee to the Bankruptcy Court met on Oct. 25, 2010, to discuss a variety of issues, including proposed amendments to the local rules and revisions to the Chapter 13 model plan. After discussion, the committee approved the following amendments, which were posted to the court’s website for comment and subsequently adopted by the Bankruptcy Court en banc.
Declaration re: Electronic Filing: Rule 1017(d)
The amendment will repeal the requirement that the Declaration re: Electronic Filing be filed in paper format. Instead, the rule will require debtor’s counsel to file a scanned image of the original document with debtor’s manual signature and full Social Security number. This document will be a private entry in the court file and cannot be viewed by the public. This rule change also will be reflected in Section II.D. of the court’s administrative procedures. (See below for filing instructions.)
Notice of Default to Include Payment History: Rule 4001-1(H)
Where a movant has filed a motion for relief from stay that alleges that the debtor has defaulted on any term of a conditional order granting relief from stay, the proposed amendment will require that the notice to cure include a payment history from the date of the issuance of the conditional order.
New Rule Requiring Format for Amended Schedule C (Exempt Property): Rule 1009-1D
This new rule will require that all amendments to Schedule C (exempt property) restate in full all claimed exemptions. All changes to previously claimed exemptions must be identified or footnoted in the amended schedule, and if the debtor fails to meet these requirements, the debtor will be deemed to have failed to meet the notice requirement for amended schedules under Rule 1009 of the Federal Rules of Bankruptcy Procedure.
Proposed Revisions to the Chapter 13 Model Plan
The committee also approved certain proposed changes to the Chapter 13 model plan. These include provisions that related to: (1) a check box for identification of plans that include non-standard provisions; (2) a check box to identify whether required tax returns have been filed or, if not, which years are outstanding; (3) a provision permitting a claim objection or plan amendment subsequent to confirmation if it later appears that the claim of a mortgage creditor was improperly perfected; and (4) a provision for turnover of pre-petition income tax refunds and proceeds from lawsuits or administrative claims pending as of the date of filing.
The court would like to thank the following members of the Attorney Advisory Committee, whose terms have or will expire at the end of 2010, for their service to the court and the committee: Jason Amerine, David Barlow, Harry Boul, Wendee Elliott-Clement, Rachel Foley, Jere Loyd, Robert Maher, Tom O’Neal, Jill Olsen and Sherri Wattenbarger (chair).
Current members of the committee which include Jerald Enslein, Steven Leigh, Connie Montgomery, and Jeffrey Wagoner will be joined by the following new members beginning Jan. 1, 2011: Daniel Casamatta (chair), J. Brian Baehr, Douglas Breyfogle, Benjamin Mann, Carrie Mermis, Danny Nelson, Tracy Robinson, Cristine Stallings, Victor Weber and Tracy Wrisinger.
To file the Declaration under Rule 1017(d) electronically:
The U.S. Bankruptcy Court en banc for the Western District of Missouri adopted 2010 Standing Order No. 1 and the Second Amended 2008 Standing Order No. 2 on Nov. 16, 2010, effective Dec. 1, 2010.
2010 Standing Order No. 1 grants an extension to the debtor in an involuntary bankruptcy case to file the list of creditors. The order can be accessed at http://www.mow.uscourts.gov/bankruptcy/rules/so_2010_granting_ext.pdf.
The Second Amended 2008 Standing Order No. 2 pertains to the National Guard and Reservists Debt Relief Act of 2008 and incorporates a reference to an amended deadline in Bankruptcy Rule 1007.
A red-lined version of the order can be accessed at
A clean version of the order can be accessed at http://www.mow.uscourts.gov/bankruptcy/rules/so_2d_amd_adopting_interim_bk_r_2007.pdf.
(Reprinted from The Third Branch, Vol. 42, Number 11, November 2010)
Baby Boomers Account for Nearly Half of Bankruptcies Filed
Three years ago, a study by Administrative Office statisticians showed a gradual aging of the typical bankruptcy filer, with filers over the age of 45 accounting for a larger percentage of overall filers. Following implementation of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA), the economic downturn and the housing crisis, are bankruptcy filings still a function of age?
Percentage of Bankruptcy Filers Over the Age of 45
To answer that question, statistician John Golmant, who conducted the original study, and social science analyst James Woods, both of the AO’s Statistics Division, reviewed 822,590 Chapter 7 and Chapter 13 bankruptcy filings for the 12-month period ending Dec. 31, 2007. The chapters account for 99.9 percent of all consumer filings. Filers’ birth dates were obtained using outside data sources for a sampling of 2,100 cases.
Golmant and Woods found that the middle–aged still file the bulk of bankruptcies. The median age for bankruptcy petitioners increased from 37.7 years in 1994 to 41.4 years in 2002 to 44.9 years in 2007. Bankruptcy p etitioners over the age of 45 constituted 27 percent of filers in 1994, 39 percent in 2002 and 50 percent in 2007.
That middle-age filers have come to account for an increasing percentage of overall filers means that baby boomers—those who attained the ages of 43 through 61 during 2007—are disproportionately represented in bankruptcy proceedings.
Several indicators show this age group to be facing financial difficulties, including an increase in the ratio of debt payments to family income for those aged 45 and above. The ratio declined for those under 45. From 2004 to 2007, the percentage share of families with a debt ratio of at least 40 percent rose fastest for those over 45. Additionally, 28 percent of all mortgage delinquencies and foreclosures were for persons 50 years and older.
Meanwhile, the net worth of the middle-aged and older has declined. The median household for persons between the ages of 45 and 54 lost 45 percent of its net worth between 2004 and 2009, and the median household for persons between the ages of 55 and 64 lost 50 percent of its net worth in the same time period.
Percentage of Overall Bankruptcy Filers by Age Group
Credit card debt may play a role as the median value of credit card debt of those aged 55 to 64 increased 9 percent between 2001 and 2004, and 50 percent between 2004 and 2007. For those aged 65 to 74, median credit card debt increased 25 percent from 2004 to 2007.
The effect of BAPCPA on the composition of filings by age is difficult to gauge, according to the authors of the study. They note that post-BAPCPA, there has been an increase in the percent of Chapter 13 filings—an option the act promoted while also increasing restrictions on Chapter 7 filings. It is possible that, given the recent housing crisis and economic downturn, more debtors chose to file Chapter 13 in an effort to postpone foreclosure on their homes. The study showed, however, that the fastest growth in Chapter 13 filings occurred in those debtors between the ages of 55 and 64.
“Given that the proportion of Chapter 13 petitions filed by 55- to 64-year-olds increased dramatically, and given that this age group also contributed to a significant number of foreclosures, it seems plausible that the two phenomena are linked,” the study concludes.
The complete study, Aging and Bankruptcy, Revisited, was published in the September 2010 issue of the American Bankruptcy Institute Journal and can be obtained by contacting John Hartgen at 703-894-5935 or firstname.lastname@example.org.
The Western District Bankruptcy Court has had a total of 3,882 cases filed during the months of September, October and November, and they are broken down by month and division as shown below:
Bankruptcy Case Filings by Division―September through November 2010
Reminder About NEFs
NEFs (Notices of Electronic Filings) are only “active” for two weeks. After that period, the attorney must pay to view the document.