In Anwar v. Johnson, after a debtor’s debts were discharged under a Chapter 7 bankruptcy, two of the debtor’s former employees objected to the dischargeability. The former employees argued that the debts owed to them were obtained by fraud, and therefore, were exceptions from discharge under Bankruptcy Code Section 523(c). However, Rule 4007(c) of the Federal Rules of Bankruptcy Procedure requires complainants who object to a debt’s dischargeability to file their objection within 60 days. The 60 day period is measured from “the first date set for the meeting of creditors under Section 341(a).
When the former employees missed the 60 day deadline, the bankruptcy court held that it lacked the discretion to grant a retroactive extension of the filing deadline established under Rule 4007(c). The district court affirmed. On appeal, the Ninth Circuit Court of Appeal affirmed the district court holding.
The Court of Appeal held that the deadline could not be retroactively extended because “neither the federal rules, local rules, nor model rules of bankruptcy procedure
gave the bankruptcy court authority to relieve [claimants] from the consequences of [the] untimely filing.”
Objecting claimants, beware of deadlines!!
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