§ 43.5     Consequences of Failure to Attend Meeting of Creditors
Cite as:    Keith M. Lundin, Lundin On Chapter 13, § 43.5, at ¶ ____, LundinOnChapter13.com (last visited __________).
[1]

Typically, the failure of a Chapter 13 debtor to attend the meeting of creditors results in a motion to dismiss the case.1 In some jurisdictions, this motion takes the form of a “show cause” order issued by the clerk of the court.2 In other jurisdictions, the motion is filed by the Chapter 13 trustee or by a creditor. In some jurisdictions, the petition is automatically dismissed by local rule if the debtor fails to appear at the meeting of creditors;3 to avoid dismissal, counsel must move to reschedule or for some other relief in advance of the meeting or within a specified number of days of the failure to appear.

[2]

Though at least one court has confirmed a Chapter 13 case despite the debtor’s failure to appear at the meeting of creditors,4 it is likely that the Chapter 13 trustee or creditors will object to confirmation of a plan without a personal appearance by the debtor. Often the failure to attend the § 341 meeting is caused by a temporary problem, and upon motion with explanation, a second or continued meeting will be scheduled and the case proceeds toward confirmation.

[3]

Practice varies on how this second chance is accomplished. In some jurisdictions, it is scheduled automatically in connection with a show-cause hearing on the debtor’s prior failure to appear. In other jurisdictions, debtor’s counsel must make a motion to reset the meeting of creditors after the debtor fails to appear. No provision of the Code or Bankruptcy Rules tells us to whom one applies to be relieved from a failure to appear at a prior meeting of creditors. Because the U.S. trustee is not empowered by statute to relieve a Chapter 13 debtor (or any debtor) of the statutory obligation to appear at a meeting of creditors, debtor’s counsel should move the court for relief from a failure to appear at the meeting of creditors.

[4]

The U.S. trustee has the responsibility to call the meeting of creditors and, by inference, to call any rescheduled meeting of creditors. Debtor’s counsel is best advised to make a motion to the bankruptcy court for relief from the debtor’s failure to appear at a meeting of creditors; but counsel may also have to apply to the U.S. trustee (a letter? a telephone call?) to get the U.S. trustee to call a rescheduled meeting. It is then up to the clerk, the debtor’s counsel, or whoever has been so instructed to give notice to all creditors of the rescheduled § 341 meeting.

[5]

In some jurisdictions, it is the practice for creditors that were present at a meeting of creditors at which the debtor failed to appear to move for the allowance of fees for their appearances as a condition to continuation of the case.


 

1  Curiously, the debtor’s attendance at the meeting of creditors is required by 11 U.S.C. § 343, but failure to attend is not listed as one of the specific examples of cause for conversion or dismissal of a Chapter 13 case in 11 U.S.C. § 1307(c). However, examples of cause in § 1307(c) are not exhaustive. It is very likely that a debtor’s failure to appear at a meeting of creditors would be included by most courts as cause for conversion or dismissal of a Chapter 13 case. See §§ 312.1 [ Cause for Conversion ] § 141.3  Cause for Conversion, 333.1 [ Cause for Dismissal—In General ] § 152.2  Cause for Dismissal—In General and 334.1 [ Cause for Dismissal, Including Bad-Faith, Multiple and Abusive Filings ] § 152.4  Cause for Dismissal, Including Bad-Faith, Multiple and Abusive Filings. See, e.g., Simmons v. Cosby (In re Simmons), 256 B.R. 578 (D. Md. 2001) (Pro se debtor’s failure to appear at original or rescheduled meeting of creditors is adequate ground for dismissal under § 1307(c)(1).); In re Hall, 266 B.R. 659 (Bankr. W.D. Ky. 2001) (Failure to attend § 341 meeting is cause for dismissal.).

 

2  An order issued by the clerk of the bankruptcy court requiring the debtor to appear and “show cause” why the Chapter 13 case should not be dismissed for failure of the debtor to appear at the meeting of creditors is in essence a motion by the court to dismiss for cause under § 1307(c). See § 152.1  Procedure, Timing and Form Dismissal of a Chapter 13 case on the court’s motion is awkward; however, there is statutory authority for sua sponte dismissal, and some reported decisions condone the practice. See § 152.7  Sua Sponte Dismissal.

 

3  See, e.g., In re Parks, No. 08-50334-C, 2008 WL 941774, at *1 (Bankr. W.D. Tex. Apr. 4, 2008) (unpublished) (Leif Clark) (Under local standing order, Chapter 13 case is summarily dismissed for debtors’ failure to appear at meeting of creditors; debtors had notice of § 341 meeting and requirement to attend. “There is one exception to the general rule, however. If the debtor has been denied due process, then summary dismissal would not be appropriate.”).

 

4  See In re Perskin, 9 B.R. 626 (Bankr. N.D. Tex. 1981).