Creditor can rely on Trustee's Motion To Extend Deadline To Object

J Thomas Black
Board Certified, Consumer Bankruptcy Law- Texas Board of Legal Specialization
Posted on Oct 30, 2013

In a case out of the U.S. Bankruptcy Court for the Southern District of Texas, Brownsville Division, the court ruled that the creditor in a chapter 7 case timely filed its complaint objecting to the discharge of the debtor's debt, even though there had been 3 extensions of the deadline on the Trustee's motion, and the Trustee filed a notice of withdrawal of the third motion to extend. In re Gilbert, Bankr. S.D. TX 2013

For a creditor to object to the discharge of a debtor's debts, or a particular debt, for certain reasons such as fraud, an objection has to be filed within 60 days of the first date set for the Meeting of Creditors. This deadline is strictly enforced, so that the debtor can receive his or her discharge promptly.

However, this deadline can be extended by the bankruptcy court, so long as the motion to extend is filed before the deadline. In this case, there were 3 motions to extend time filed by the chapter 7 trustee, but they were all timely filed, before the deadlines ran out.

Anyway, the trustee filed a notice of withdrawal of his third motion, but the creditor objected to the withdrawal, as they had joined in the 3rd motion with the trustee. The court ruled:

...under these discrete set of facts, Glasscock was justified in its reliance on the first two orders extending time for objection to dischargeability. Moreover, because Glasscock joined the third motion and objected to the Trustee's withdrawal of the third motion to extend, the Court finds that the third motion to extend should be granted as to Glasscock. Therefore Glasscock's Complaint for Determination of Dischargeability Pursuant to Section 523 of the Bankruptcy Code filed on July 19, 2013, was filed within the deadline.

 

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