the advance notice and hearing requirements under Rule 9014 may not be satisfied . Moreover , in many cases the debtor will incur the additional costs associated with the enhanced service requirements under Rule 7004 ( h ), as many secured creditors are insured depository institutions .
By forcing the debtor to make a request for stay termination that is not required by the Code , rather than have it listed on a Local Form as an available option , the proposed rule takes away the debtor ’ s right to propose the specific content of the plan . Moreover , there are good reasons why a debtor should not be compelled to seek stay termination . It is not uncommon for debtors to provide for surrender of collateral in the plan and at the same time be actively involved with the secured creditor in negotiating a loan modification or some other form of loss mitigation . It makes no sense for a debtor in that situation to request stay termination . It would also be inconsistent with the procedural rules that some bankruptcy courts have established for loss mitigation mediation programs .
For these reasons NACBA requests that proposed Rule 3015.1 ( d )( 5 ) be revised to provide that a Local Form plan may list a request for stay termination as an available option to the debtor , but shall not mandate that such a request be made in connection with surrender .
Requests for Determination of Amount of Secured Claim and Avoidance of Judicial Liens
Proposed Rule 3012 ( b ), which would become effective at the same time as proposed Rule 3015.1 , provides that a request to determine the amount of a secured claim may be made in a motion , in a claim objection , or in a plan filed in a chapter 12 or 13 case . Proposed Rule 4003 ( d ), also to become effective at the same time , provides that a request for lien avoidance under section 522 ( f ) made be made by motion or by a chapter 12 or 13 plan . Although these proposed rule amendments clearly provide that a debtor may make such requests in the plan , and such requests are included as optional plan provisions in the proposed Official Form Chapter 13 Plan , proposed Rule 3015.1 does not require that Local Form plans include an option for the debtor to make a Rule 3012 ( b ) or Rule 4003 ( d ) request . NACBA believes that many districts will adopt a Local Form plan that will include express provisions permitting Rule 3012 ( b ) and Rule 4003 ( d ) requests . However , based on the comments submitted by a few bankruptcy judges about the Official Form Chapter 13 Plan , it is likely that a minority of districts will adopt a Local Form without such provisions .
Debtors in those districts should not be required to make a Rule 3012 ( b ) or Rule 4003 ( d ) request as a nonstandard plan provision . It is nonsensical that an unambiguous procedural right that is permitted under the Bankruptcy Rules should be treated as “ nonstandard .” Debtor attorneys and their clients in those districts will likely incur the additional costs of filing separate motions simply to avoid the additional scrutiny of “ nonstandard ” provisions . Moreover , the detailed information required to make a make a Rule 3012 ( b ) or Rule 4003 ( d ) request , as evidenced by sections 3.2 and 3.4 of the proposed Official Form Chapter 13 Plan , will make it difficult to draft such provisions as “ nonstandard ” provisions for those debtor attorneys who persist in attempting to make the requests in the plan . It will also result in a wide variance of valuation and lien avoidance provisions , detracting from the uniformity goals of the rule amendments and making it difficult for secured creditors to review plans in those districts .
NACBA requests the Advisory Committee to amend proposed Rule 3015.1 ( d ) to include a requirement that the Local Form plan shall contain a separate paragraph that gives the debtor the option to make a Rule 3012 ( b ) and Rule 4003 ( d ) request .
Notice and Opportunity for Public Comment
Proposed Rule 3015.1 ( a ) provides that a single Local Form plan may be adopted by a district “ after public notice and opportunity for public comment . “ NACBA supports this requirement but believes that the Advisory Committee should provide more guidance on the notice and comment procedure . At a minimum , the Committee Note should state that the opt-out consideration and adoption of a Local Form should be conducted pursuant to Bankruptcy Rule 9029 . NACBA is concerned that some districts may take the view that Rule 9029 is not applicable if the district is adopting a form rather than a local rule . The adoption of a Local Form plan is a significant matter affecting chapter 13 practice and should be subject to the Rule 9029 requirements .
Proposed Rule 3015 ( c ) provides that the Official Form Chapter 13 Form must be used unless a district adopts a Local Form that complies with proposed Rule 3015.1 . Although perhaps implied in the rule amendments , NACBA believes the Advisory Committee should explicitly provide in the Committee Note that the district ’ s decision to opt out , not just the proposed Local Form , should be subject to notice and comment . Districts should be required to include in the notice seeking comment a copy of the proposed Official Form Chapter 13 Form , and the notice should solicit comment on the advisability of adopting a proposed Local Form rather than the Official Form .
While many districts include consumer debtor attorney representation on local rules committees , NACBA does not believe that this is done in all districts . Once again , the significance of the Local Form adoption on debtors ’ rights and chapter 13 practice warrants a departure from local procedures , at least for those districts that do not actively incorporate consumer attorney representation on local rules committees . NACBA urges the Advisory Committee to indicate in the Committee Note or in some other form the expectation that districts will solicit participation from the consumer debtor
National Association of Consumer Bankruptcy Attorneys Winter 2016 CONSUMER BANKRUPTCY JOURNAL 5