What is the Automatic Stay?
Once a Debtor has filed Bankruptcy, most proceedings to collect debts are stayed, which means they must stop. 11 USC § 362(a). In order for a party to begin or continue a proceeding to collect a debt against the Debtor that has been stayed because of the filing of Bankruptcy and the Automatic Stay, he must file with the Bankruptcy Court a Motion for Relief from the Automatic Stay. A party may also file a Stipulation for Relief from the Automatic Stay if the other parties, the Debtor and the trustee agree.
Rules of Reference
- 11 USC § 362(a)
- Federal Bankruptcy Rule 4001
- Federal Bankruptcy Rule 9014
- Local Bankruptcy Rule 4001-1
- Local Bankruptcy Rule 9014-1
How is a Motion for Relief from the Automatic Stay Begun?
A motion is a written formal statement in which a party requests some relief from the Bankruptcy Court. In the Motion, the party requesting the relief, the Movant, includes the legal basis, citing the applicable section of the Bankruptcy Code and Bankruptcy Rules, for the relief requested. The parties against whom the relief is requested, the Debtor and the trustee, are the Respondents. Each motion should be supported by all documents which assert a valid perfected security interest and all documents which show that there is a lack of adequate protection or equity in the property.
Is there a specific form for the Motion for Relief from the Automatic Stay?
There is no specific form required for the Motion.
Motion for Relief from the Automatic Stay on a Chapter 13 Co-Debtor
This type of Motion is governed by 11 USC § 1301. There is no filing fee for this type of motion.
Is there a filing fee?
The current filing fee for a Motion for Relief from the Automatic Stay is $181.00 (cashiers check money order, credit card or cash – no personal checks). This filing fee applies to all parties, including the debtor, if the debtor is filing the motion. If the party filing the Motion is a creditor owed child support by the Debtor, the filing fee is not due provided the creditor files Form 2810 Appearance of a Child Support Creditor or Representative.
What is required when filing a Motion for Relief from the Automatic Stay?
- Filing fee of $181.00 (except when the filing fee is not required);
- An original of the Motion for Relief from the Automatic Stay;
- An original of the Notice of Motion and Opportunity to Object;
- A form of Proposed Order granting the motion;
- A brief, not more than 20 pages, in support of the Motion; and
- A Certificate of Service
What is a Notice of Motion and Opportunity to Object?
This is a local form providing the details of the Motion and stating that any party wishing to file an objection to that Motion must do so in writing, file the original with the Bankruptcy Court and serve a copy on the Movant within 14 days of receiving a copy of the Motion.
What is a Certificate of Service?
The Movant is responsible for serving the Motion by sending a copy of the Motion, Notice, Order and brief, if applicable, to all the parties involved: Debtor, Debtor’s attorney, the trustee, and any other party known to claim an interest in the property, rents, issues, profits or proceeds.
Service may be done in a variety of ways; however, the easiest method is to mail the Motion, Notice, Order and brief, if applicable, by first class postage pre-paid mail to the party’s residence or the place where the party regularly conducts business. Service is complete upon mailing.
After service has been made, you must file a Certificate of Service with the Court. There is no required form of Certificate of Service. The Certificate of Service must state the following facts: the date the documents were sent, the names of the documents that were sent, the names and addresses of the parties served and how service was done.
What happens if no objection is filed?
You must follow Local Rule 9014-1 and submit a certificate of no response and the original of the Proposed Order, copies of which you already served on the parties. An original and one copy must be provided to the Court. Submit a self-addressed and stamped envelope for copies to be returned to you.
Once the Order is signed, who serves the Order on the Respondent?
You, the Movant, are responsible for serving the Order on the Respondent and the Respondent’s attorney, if there is one. Service can be made by mail.
What happens if an Objection to the Motion for Relief from the Automatic Stay is filed?
Once as objection is filed, procedures for setting a Hearing differ depending upon the Judge. You will be notified of a date and time for any hearing.
Once the hearing is set by the Court, you must appear at the hearing. What happens once the hearing is set?
The Motion for Relief from Automatic Stay would then go through its course until the Judge renders a decision, lifts the Automatic Stay or the parties reach a stipulation.