A bankruptcy court has ruled that secured creditors must file proofs of claim on time if they choose to file them. The specifics of the ruling may be enlightening to Texas residents who have filed for Chapter 13 bankruptcy protection. Chapter 13 gives individuals who have a regular source income the opportunity to restructure and relieve debt without requiring them to give up their property. Debtors must provide the court with a plan to repay debts using future income.
In an Ohio case, a limited liability company had a claim against a married couple who had filed under Chapter 13. It had a lien on the couple's home due to the couple's real property tax debt. Despite having notice of the deadline date for filing proofs of claim, the company failed to file on time.
The court asked the couple if they would like to file a claim on behalf of the company, and they declined. They provided the court with a repayment plan that did not call for any payments to the company. The court approved it.
The company wanted the right to payments under the plan and so filed a motion for permission to file a late proof of claim. The court denied the motion, citing Rule 3002(a), which says secured creditors must file proofs of claim if they want to receive distributions. The rule allows for late filings in certain circumstances, none of which applied to the company.
An attorney with experience in bankruptcy law might help in a case like this by advising the debtor regarding his or her rights and obligations. An attorney could help draft the Chapter 13 bankruptcy plan and submit it to the court for its approval.