New federal rules of bankruptcy procedure changes deadlines and time frames impacting numerous matters, including effective date of relief from stay orders.

RFS ORDER IS NOT EFFECTIVE UNTIL 14 DAYS AFTER THE ORDER IS ENTERED, UNLESS SPECIFICALY WAIVED BY THE COURT. OLD TEN DAY RULE NO LONGER APPLIES.

The Federal Rules of Bankruptcy Procedure have been amended effective as of December 1st, 2009. The purpose of the change in the Rules is to make time calculations more consistent throughout the Rules. Rule 9006(a) sets forth precisely how to calculate the time requirements of the Rules. It has been changed significantly, and must be consulted when determining how deadlines are impacted.

The gist of the rule changes are these according to the Federal Rules of Civil Procedure Advisory Committee:

"Notes of Advisory Committee on 2009 amendments. The rules are being amended to implement changes in connection with the amendment to Rule 9006(a) and the manner by which time is computed under the Rules. The deadlines in the rules are amended to substitute a deadline that is a multiple of seven days. Throughout the rules, deadlines are amended in the following manner:

  • 5-day periods become 7-day periods
  • 10-day periods become 14-day periods
  • 15-day periods become 14-day periods
  • 20-day periods become 21-day periods
  • 25-day periods become 28-day periods

These changes are critical and impact deadlines for many actions under the Rules, such as the time to respond to motions, the time for filing a notice of appeal (14 days rather than ten days); the time before an order for relief from stay becomes effective (14 days rather than 10), and many other matters.

All trustees should be aware that Orders for Relief from Stay are NOT effective until 14 days after the entry of the order, unless the court orders otherwise. Rule 4001(a)(3) now reads:

"(3) Stay of order. An order granting a motion for relief from an automatic stay made in accordance with Rule 4001(a)(1) is stayed until the expiration of 14 days after the entry of the order, unless the court orders otherwise."

In summary, when an Order for Relief is received, it must be determined if the court has waived the restrictions under 4001(a)(3). Such a waiver will be found right in the Order if it exists. It no such waiver is in the order, no actions can be taken pursuant to the order until 14 days after entry of the Order.

There are many other federal Rules affected. Some of the Rules are:

Bankruptcy Rules 1007, 1019,1020, 2015, 2015.1, 2016, 3015, 4001, 4002, 6004, 6007, and 8009.

Consult your counsel should you have questions on the foregoing.

Patric J. Kelly is a member of and senior counsel in Adleson, Hess & Kelly, A.P.C., located in Campbell, California. He specializes in creditor bankruptcy matters and in real estate litigation impacting lenders, such as foreclosure matters and receiverships. He can be contacted at 408-341-0234.