The Western District of Pennsylvania’s Bankruptcy Court Defends Captioning Rules

10 Nov The Western District of Pennsylvania’s Bankruptcy Court Defends Captioning Rules

For the sake of safe-guarding the due process rights of creditors involved in bankruptcy proceedings in the Western District of Pennsylvania, local rules of procedure require debtors to list each and every creditor by name as respondents in Motions which affect their rights. The rule was instituted shortly after BAPCPA took effect on October 17, 2005 and was made applicable primarily to Motions to Extend the Automatic Stay and Motions to Impose the Automatic Stay. The rule also generally applies to Motions to Amend Confirmed Chapter 13 Plans Pursuant to Section 1329.

Recently, the rule was challenged by an attorney who felt the local requirement to actually name every creditor as opposed to being permitted to incorporate them by reference in the caption contravened Federal Rule of Civil Procedure 10(c). Judge Thomas P. Agresti rejected this argument by opining that the Court is within the bounds of its authority to require such a procedure on constitutional grounds. Judge Agresti also reminded Counsel that disagreement with a Court Order does not excuse the one subject to the Order from following same unless the requirements of the Order are lawfully stayed pending appeal. Judge Agresti quoted the United States Supreme Court in support of this declaration:

We begin with the basic proposition that all orders and judgments of courts must be complied with promptly. If a person to whom a court directs an order believes that order is incorrect the remedy is to appeal, but, absent a stay, he must comply promptly with the order pending appeal. Persons who make private determinations of the law and refuse to obey an order generally risk criminal contempt even if the order is ultimately ruled incorrect …. The orderly and expeditious administration of justice by the courts requires that an order issued by a court with jurisdiction over the subject matter and person must be obeyed by the parties until it is reversed by orderly and proper proceedings. In re United States v. United Mine Workers, 330 U.S. 258, 293, 67 S.Ct. 677, 696, 91 L.Ed. 884 (1947).

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