In re Outboard Marine Corp., 04-1009.

• Decision Date: 18 October 2004
• Docket Number: No. 04-1009.,04-1009.
• Citation: 386 F.3d 824
• Parties: In re: OUTBOARD MARINE CORPORATION, Debtor. Appeal of: Travis Boats & Motors, Incorporated, doing business as Travis Boating Center, Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

386 F.3d 824 In re: OUTBOARD MARINE CORPORATION, Debtor.
Appeal of: Travis Boats & Motors, Incorporated, doing business as Travis Boating Center, Appellant. No. 04-1009. United States Court of Appeals, Seventh Circuit. Argued September 8, 2004. Decided October 18, 2004.

Appeal from the United States District Court for the Northern District of Illinois, Milton I. Shadur, J.

Page 825

Kevin T. Keating (argued), Keating & Shure, Chicago, IL, for Appellant Travis Boats & Motors, Inc.

Steven B. Towbin (argued), Shaw, Gussis, Fishman, Glantz, Wolfson & Towbin, Chicago, IL, for Trustee-Appellee Alex Moglia.

Page 826

David S. Kurtz, Skadden, Arps, Slate, Meagher & Flom, Chicago, IL, for Debtor Outboard Marine Corp.

Before BAUER, MANION, and KANNE, Circuit Judges.

BAUER, Circuit Judge.

Appellant-Creditor Travis Boats & Motors, Incorporated ("Travis Boats"), appeals from a bankruptcy court order that disallowed its claim in the Outboard Marine Corporation ("OMC") Chapter 7 bankruptcy proceeding for failure to timely file a proof of claim. The Notice of Claims Bar Date required creditors to mail their proofs of claim to a designated post office box so as to be received by the OMC claims agent by November 15, 2002. Travis Boats faxed its proof of claim to counsel for the OMC bankruptcy trustee on November 15, 2002. The trustee objected to the claim as untimely, and the bankruptcy court sustained the objection, disallowing Travis Boats' claim. The district court affirmed. We affirm the bankruptcy court's conclusion about the timeliness of Travis Boats' claim, but we reverse the court's decision to disallow the claim.

I. Background

On December 22, 2000, the OMC debtors filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code. On August 20, 2001, the cases were converted to a Chapter 7 liquidation, and a trustee was appointed on August 24, 2001. The trustee subsequently determined that a distribution to OMC's general unsecured creditors was possible, and sought authority from the bankruptcy court to fix a claims bar date. On July 16, 2002, the bankruptcy court set a claims bar date of November 15, 2002 ("Bar Date"), and approved the Notice of Bar Date.

Because the trustee anticipated a significant number of claims, he sought the bankruptcy court's permission to appoint a claims agent. After receiving such permission, the trustee charged the agent with cataloguing the proofs of claim that were received both before and after the agent's appointment. To streamline the claims procedure, the claims agent designated a post office box as the repository for all proofs of claim.

On or about August 15, 2002, the trustee served the Notice of Bar Date on all of OMC's known creditors by first class mail. In the Notice, the trustee informed OMC's creditors about the impending liquidation of OMC's assets, and warned them that they may not be paid on their claims against OMC if they failed to timely file the enclosed proof of claim form. The Notice also specified the method of transmittal, and emphasized that the claims had to be received by the bar date:

File our Proof of Claim by sending it to:

OMC Claims Agent P.O. Box 560 Waukegan, IL 60079-560

To be timely, all Proofs of Claim must be filed so as to be RECEIVED by the OMC Claims Agent on or before the Bar Date. Proofs of Claim are deemed filed only when actually received by the OMC Claims Agent.

Any questions, please call the OMC Claims Agent at (312) 602-2299.

App. 1 (emphasis in original). The phone number listed on the Notice automatically connected to a voicemail message system, where the messages would be retrieved by counsel for the trustee. The OMC claims agent received more than 5300 proofs of claim asserting claims against OMC in excess of $3.5 billion.

Page 827

On the Bar Date, Travis Boats mailed a proof of claim in the amount of $1,138,216.90 to the OMC claims agent at the address provided on the Notice. That claim was received by the OMC claims agent on December 9, 2002, and assigned Claim No. 5354. Although the Notice of Bar Date did not provide creditors with a fax number, counsel for Travis Boats also transmitted by facsimile a duplicate of Claim No. 5354 to counsel for the trustee on the Bar Date. According to Travis Boats, counsel for Travis Boats was given the fax number when he called the telephone number provided in the Notice and asked for the fax number. Upon receipt of the faxed proof of claim, counsel for trustee mailed it to the OMC claims agent, who received it on November 21, 2002, and assigned Claim No. 5293.

On July 11, 2003, the trustee filed an omnibus objection to numerous claims, including Claim No. 5293 and Claim No. 5354. The trustee objected to the Travis Boats claims as untimely. Travis Boats filed a response to the trustee's objection with respect to Claim No. 5293 (the facsimile proof of claim), but did not oppose the trustee's objection to Claim No. 5354 (the proof of claim transmitted...