Rule 2081-3 : Chapter 11 – Motions To Dismiss or Convert


(a) Applicability: This rule applies to motions to dismiss or convert a chapter 11 case pursuant to 11 U.S.C. § 1112.

(b) Selecting a Hearing Date: Each division of the court maintains a chapter 11 dismissal motion calendar. Information as to the time and dates of each division's calendar may be obtained from the court’s website at www.cob.uscourts.gov or the assigned judge’s staff. All dismissal motions must be set for hearing on the calendar of the division to which the case is assigned.

(1) Notice Period: Pursuant to FED. R. BANKR. P. 9006(c), the court finds cause exists to shorten the time to object to fourteen (14) days.

(2) Hearing Date: A party filing a dismissal motion in a pending chapter 11 case must select from the calendar of available hearing dates a proposed hearing date, which must be the latest hearing date available on the assigned judge’s calendar which is not more than thirty (30) days from the date the dismissal motion is filed with the court. In the event the movant sets a hearing date beyond thirty (30) days, the movant is deemed to have waived its right under 11 U.S.C. § 1112(b)(3) to a hearing within thirty (30) days and a decision within fifteen (15) days of the commencement of the hearing.

(3) Notice of Hearing: Subject to the time limitations set forth in subsections (1) and (2) above, the movant must comply with the provisions of L.B.R. 9013-1. The notice of hearing must specify the following:

(A) the hearing date, time and location;

(B) that an objection and request for hearing must be filed by a date certain that is at least fourteen (14) days after notice of the motion; and (C) that, if no objection is timely filed, the requested relief in the motion may enter without a hearing, upon the filing of a certificate of non- contested matter.

(4) Notice: The notice and motion must be served on the debtor, the debtor’s counsel, the United States Trustee, any case trustee and those requesting notice. The notice must also be mailed to all creditors and parties in interest.

(c) Procedures for Preliminary Hearings: The following procedures apply at preliminary hearings on motions to dismiss:

(1) No testimony will be taken. Evidence will only be accepted by way of an oral offer of proof and exhibits. Such offers must provide sufficient detail to enable the court to make specific findings based thereon and must include the identity of the witnesses available to testify at an evidentiary hearing and an explanation of their expected testimony. Written summaries of witnesses’ testimony are not required but may be submitted.

(2) Parties must exchange all exhibits they intend to use, or may reasonably anticipate using, 24 hours prior to the preliminary hearing. The exhibits must be tendered to the court at the hearing, together with a statement identifying the witness or witnesses who would be called to identify and lay the foundation for the introduction of such exhibits.

(3) Objections to tendered evidence should be made at the conclusion of each party’s declaration. Any objection must identify the evidence objected to and specify the grounds for the objection.

(4) The court will treat the hearing as a preliminary hearing and, based on the proffers of evidence, if the movant establishes sufficient cause, may set the matter over for a final hearing. In the alternative, the court may consider the offers of proof and, absent the need for an evidentiary hearing, grant or deny the request for dismissal.

(5) Expert Witnesses: Any party anticipating the use of an expert witness for a final hearing will, at the preliminary hearing, comply with FED. R. BANKR. P. 7026(a)(2).

(d) Telephonic Hearings: Parties, through counsel, are required to attend the hearing in person except on prior request and approval of a telephonic appearance by the judge to whom the case is assigned. Telephonic appearances must be requested by filing a motion. If a telephonic appearance is permitted, the parties must exchange witness lists and exhibits and file them with the court no later than 24 hours prior to the hearing.

(e) Waiver of 30 Day Hearing: In the event that the movant does not select a hearing date pursuant to sub-section (b), movant must follow the motion practice procedures set forth in L.B.R. 9013-1, and comply with the notice period as directed by FED. R. BANKR. P. 2002(a)(4). Using the L.B.R. 9013-1 procedures constitutes a waiver by the movant of the hearing and ruling time requirements of 11 U.S.C. § 1112(b)(3).

Commentary

[Source: GPO 2007-1]

See L.B.R. 1017-1, 2, and 3 for other local rules on conversion and dismissal.

See also L.B.R. 9070-1 for information on witnesses and exhibits.

The L.B.Form 9013-1.3 Certificate of Non-Contested Matter and Request for Entry of Order should be used when no objection is timely filed as referenced in subparagraph 3(b)(3)(C) above.
Selecting a hearing date is intended to make it possible for the parties and the court to comply with the notice requirements of FED. R. BANKR. P. 2002(a)(4) and the hearing requirements of 11 U.S.C. § 1112(b)(3). In order to best comply with the Bankruptcy Code, the court has found cause to shorten the notice period for self-calendared motions pursuant to FED. R. BANKR. P. 9006(c).