New New Jersey Chapter 13 Court Rules
Dateline: January, 2005
By: Alan F. Such, Esq.
Overview:
The Bankruptcy Court for the District of New Jersey has implemented new Court Orders and related Notices to the Public effective January 17, 2005. Below is a brief discussion of each Order and Notice:
Order Permitting Secured Creditors to Provide
Debtors with Monthly Statements, Payment Coupons
and Related Notices Without Violating the Automatic Stay:
Click here for
copy of Order
Click here for copy of Notice of Order
Forwarding such notices will
not be construed as a violation of automatic stay. Related Notices include
Reminder Statements (provided that the statements are informational purposes
only and do not demand payment) and Payment Change Notices (including the status
of an escrow account or change in the interest rate). I strongly recommend that
such Statements be
forwarded to the Debtors so that they are aware of the correct monthly payment.
Order Relating to Motions for Relief; and Requiring the Filing of Chapter 13 Debtor's Certification in Opposition to Creditor's Motion or Certification of Default and Related Forms:
Click here for copy of Notice of Order
1) The Debtor must file an Objection to a Motion for Relief at least seven (7) days prior to the Motion return date and within ten (10) days of the filing of a Certification of Default and the Objection must be filed in accordance with a new form issued by the Court.
2) Secured Creditors must file Local Form 16 (Complete Post-Petition Payment History) when filing a Certification of Default. Therefore, it is imperative that we receive a complete post-petition payment history with a Certification of Default or Exparte referral.
3) Secured Creditors shall be required to accept post-petition payments from a Debtor and to apply said payments without prejudice. Please make sure that all post-petition payments are applied and not returned to the Debtor or your local counsel as this will only create a delay in obtaining the correct payment status of a loan.
4) A Scheduling Order Regarding Certain Chapter 13 Payment Dispute Issues will be entered by the Court which will require the exchange of payment records before the hearing at the Judges discretion.
Order as to Objections to Confirmation:
Click here for copy of Notice of Order
A creditor's Proof of Claim shall be used in determining the amount of a creditor's claim and shall constitute an Objection to Confirmation of Debtors Chapter 13 Plan. The Debtor shall have the right to object the Proof of Claim for sixty (60) days after confirmation of Debtor's Plan. However, we recommend that a Chapter 13 Plan continue to be reviewed carefully and in its entirety as such issues as feasibility, proposed cram down of a loan, proposals to sell or refinance, verification that post-petition payments are to be maintained during the course of the case, etc. are specifically addressed through a separate pleading. If a Chapter 13 Plan is confirmed with any of the above proposals, a Secured Creditor will be bound by the terms of the confirmed Plan.
This Article is a service of the Creditors’ Rights Department and Litigation Department of Fein, Such, Kahn & Shepard, P.C., 7 Century Drive, Suite 201, Parsippany, NJ 07960. Phone: 973-538-4700. Website: www.feinsuch.com. It does not constitute legal advice nor create an attorney-client relationship. For more information contact Shareholder Alan F. Such, Esq. at afs@feinsuch.com.
© 2005, Fein, Such, Kahn & Shepard, P.C., all rights reserved. Permission is granted to reproduce and redistribute this article so long as (i) the entire article, including all headings and the copyright notice are included in the reproduction, and (ii) no fee or other charge is imposed.