In re Plourde, No. 05-15221-JMD.
| Decision Date | 17 November 2008 |
| Docket Number | No. 05-15221-JMD. |
| Parties | In re Robert G. PLOURDE and Debra A. Plourde, Debtors. |
| Court | United States Bankruptcy Courts. First Circuit. U.S. Bankruptcy Court — District of New Hampshire |
Michael S. Askenaizer, Esq., Law Office of Michael S. Askenaizer, Nashua, NH.
Grenville Clark, III, Esq., Gray, Wendell & Clark, Manchester, NH, Attorney for Creditors.
On March 15, 2006, Michael Askenaizer, the chapter 7 trustee (the "Trustee"), filed an objection to various claims of creditors in this case (the "Claims Objection"). Among the various objections, the Trustee objected to the allowance of proof of claim number 4 ("POC 4"), filed by American Express Bank, FSB ("AmEx"), and proof of claim number 18 ("POC 18"), filed by eCast Settlement Corporation, assignee of HSBC Bank Nevada, NA ("eCast") (collectively, the "Claims").1 The Trustee contends that POC 4 and POC 18 fail to include the information required by the official proof of claim form, Official Form B 102 (the "Official Form" or "Form B10"), and Federal Rule of Bankruptcy Procedure 3001.3 He argues that their failure to do so is sufficient grounds for the Court to disallow both Claims. The Creditors filed a response to the Claims Objection and the Court held a hearing at which both sides presented arguments, and the matter was taken under submission.
This Court has jurisdiction of the subject matter and the parties pursuant to 28 U.S.C. §§ 1334 and 157(a) and the "Standing Order of Referral of Title 11 Proceedings to the United States Bankruptcy Court for the District of New Hampshire," dated January 18, 1994 (DiClerico, C.J.). This is a core proceeding in accordance with 28 U.S.C. § 157(b).
A voluntary petition for relief was filed by Robert and Debra Plourde (the "Debtors") under chapter 7 of the Bankruptcy Code4 on October 14, 2005 (the "Petition Date"). On the Petition Date the Debtors also filed all required schedules. Their schedule F listed two unsecured, nonpriority debts to AmEx; however, neither of these correspond to the debt alleged in POC 4. Schedule F listed no debts to eCast although it did list an unsecured, nonpriority debt with the same account number as listed in POC 18 in the amount of $6,309.75 under the name "The GM Card."5
AmEx filed three timely, general unsecured claims on revolving credit accounts. Two of these claims referenced account numbers matching the two AmEx debts scheduled by the Debtors and the third claim, POC 4, referenced a revolving credit account debt not scheduled by the Debtors in the name of "Debra Plourde, Elect. Contr/Assoc." for $42,452.61. POC 4 was comprised of two parts, the Official Form and a single-page copy of an account statement dated October 14, 2005, which matched the amount of the claim stated on the Official Form and further indicated that the account was cancelled and suspended. POC 4 did not indicate whether the claim included interest or other charges and no itemization of such interest or charges was attached.
Creditor eCast filed one timely, general unsecured claim, POC 18, for $6,813.06. In addition to the Official Form, its proof of claim included a single-page, computer-generated summary of the account, which provided minimal account information and identified eCast as the "assignee of HSBC Bank Nevada NA/HSBC Card Services and its Assigns." POC 18 did not indicate whether the claim included interest or other charges and no itemization of such interest or charges was attached.
After the deadline to file claims had passed, the Trustee filed the Claims Objection in which he objected to numerous claims for a variety of reasons. The Court held an initial hearing on the Claims Objection at which all objections were resolved except for the objections to POC 4 and POC 18.
The Trustee objected to POC 4 on the grounds that: (1) the claim is not listed on the Debtors' schedules; (2) the documentation attached to POC 4 is insufficient to establish any liability of the Debtors for the obligation, but rather the documentation reflects that the obligation is owed by a business identified as "Elect. Contr/Assoc"; (3) no documentation is included with POC 4 to establish that Mrs. Plourde is personally liable for the obligation; and (4) the claim likely includes interest and other charges not reflected in any itemized statement with the Claim. After the Claim Objection was filed, AmEx provided the Trustee with credit card agreements executed by Mrs. Plourde as well as eight account statements for the period November 2004 through July 2005. Accordingly, the Trustee's objection has been limited to AmEx's failure to include with its proof of claim an itemization of interest and other charges or to otherwise provide such information to the Trustee.
The Trustee objected to POC 18 on the ground that, although the Claim appeared to match the account number of a claim listed by the Debtors in their bankruptcy schedules under "The GM Card," the amount stated in POC 18 was greater than the amount scheduled by the Debtors and appeared to include interest and other charges for which no itemized statement was included with the Claim. eCast filed POC 28 as an amendment to POC 18 and attached to the amended proof of claim six pre-petition account statements. However, it did not include, or provide to the Trustee, any credit card agreements or itemization of interest or other charges.
The Trustee asserts that because neither POC 4 nor POC 18 provided sufficient evidence under Bankruptcy Rule 3001(a) and (c) to constitute prima facie evidence of the validity and amount of the Claims under Bankruptcy Rule 3001(f), both Claims should be disallowed. Following the initial hearing, the Creditors filed a response to the Claims Objection in which the Creditors refused to amend their claims to reflect any interest or other charges that had been applied or to provide the Trustee with a breakdown of these charges. The Court held a second hearing after which the matter was taken under submission.
A resolution of the Claims Objection requires the Court to first determine what is required under applicable laws and procedures regarding the filing and allowance of unsecured claims in general and credit card claims in particular. The Court shall then apply those substantive and procedural requirements to the Claims at issue in the Claims Objection.
The filing and allowance of creditor claims in bankruptcy proceedings are governed by §§ 501 and 502 of the Bankruptcy Code. Travelers Cas. & Sur. Co. of America v. Pacific Gas & Elec. Co., 549 U.S. 443, 127 S.Ct. 1199, 1204, 167 L.Ed.2d 178 (2007). Section 501 provides that only a creditor or an indenture trustee may file a proof of claim.6 Section 502 provides that a proof of claim filed under § 501 is deemed allowed unless a party in interest objects. Section 502(b) provides that the bankruptcy court, after notice and a hearing, "shall determine the amount of such claim in lawful currency of the United States as of the date of the filing of the petition, and shall allow such claim in such amount, except to the extent that [the claim meets any one or more of the standards or conditions set forth in the statute]." 11 U.S.C. § 502(b); see 11 U.S.C. § 502(d) and (e).
The grounds listed in § 502(b) are the exclusive grounds under which a claim may be disallowed. Travelers, 127 S.Ct. at 1204. Thus, a claim that is unenforceable against a debtor or property of a debtor, under any agreement or applicable law, for a reason other than the claim is contingent or unmatured, may not be allowed. 11 U.S.C. § 502(b)(1). A claim for unmatured interest may not be allowed. 11 U.S.C. § 502(b)(2). A claim that is not timely filed may not be allowed. 11 U.S.C. § 502(b)(9). Section 502(b) does not list the failure to file a proof of claim in any particular form as a reason for disallowance. The only requirement is that a claim must be filed with the Court under the provisions of § 501 of the Bankruptcy Code. 11 U.S.C. § 502(a).
Unless a claim is filed in accordance with § 501, any question regarding the allowance of a claim under § 502 is irrelevant. B-Real, LLC v. Melillo (In re Melillo), 392 B.R. 1, 5 (1st Cir. BAP 2008). Once a proof of claim is properly filed under § 501, the creditor's entitlement to allowance of the claim "arise in the first instance from [the terms of any agreement and] the underlying substantive law creating the debtor's obligation, subject to any qualifying or contrary provisions of the Bankruptcy Code." Travelers, 127 S.Ct. at 1205; Raleigh v. Illinois Dept. of Revenue, 530 U.S. 15, 20, 120 S.Ct. 1951, 147 L.Ed.2d 13 (2000) (under the Bankruptcy Code); Vanston Bondholders Protective Comm. v. Green, 329 U.S. 156, 161, 67 S.Ct. 237, 91 L.Ed. 162 (1946) (under the Bankruptcy Act). The basic rule is that state law governs the substance of claims because Congress has "generally left the determination of property rights in the assets of a bankrupt's estate to state law." Raleigh, 530 U.S. at 20, 120 S.Ct. 1951 (quoting Butner v. United States, 440 U.S. 48, 54, 99 S.Ct. 914, 59 L.Ed.2d 136 (1979)); Vanston, 329 U.S. at 161, 67 S.Ct. 237.
Generally, a creditor seeking to establish a claim under state law has the burden of proof. See H & B Constr. Co. v. James R. Irwin & Sons, Inc., 105 N.H. 279, 281, 198 A.2d 17 (1964) (); Maloney v. Boston Dev. Corp., 98 N.H. 78, 81, 95 A.2d 129 (1953) (...
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