Proofs of Claim: Don’t Rely on the Mailbox Presumption – Be Sure Claims are Filed by the Bar Date with the Court Clerk or the Claims Agent
One set of cases concerns whether a claim will be deemed timely filed if it is mailed before the bar date but received after the bar date. A recent decision has the typical fact pattern. In In re North Carolina New Schools, Inc., No. 16-80411, 2020 WL 6891915 (Bankr. M.D.N.C. Oct. 26, 2020), the debtor filed a chapter 7 case and a trustee was appointed. At the outset of the case, there was no deadline for creditors to file proofs of claim because there was no property for the bankruptcy estate to distribute to creditors. But when property became available, a September 13, 2016 deadline was set.
A creditor mailed a proof of claim to the court clerk’s office that arrived a day late, on September 14, 2016. The bankruptcy trustee objected because the claim was filed after the bar date. The creditor filed an affidavit stating that the claim was mailed on or about September 7, 2016, and sought a ruling that the claim was timely. The court ruled against the creditor and for the trustee.
Deadlines for proofs of claim are governed by Bankruptcy Rule 3002. In chapter 7 cases, proofs of claim must be filed only when assets are available for distribution to creditors. Rule 3002(c)(5). Creditors are afforded 90 days to file claims, a deadline that can be enlarged in certain circumstances. See Rule 9006(b)(3). (“The court may enlarge the time for taking actions under Rule[ ]... 3002(c) … only to the extent and under the conditions stated in [that] rule[ ]”).
In North Carolina New Schools, the creditor didn’t seek an enlargement of time. Instead, it argued the claim should be deemed timely filed based on the application of the “mailbox presumption.” This presumption is a common law principle providing that mail placed in the U.S. postal service is presumed to have been received. See Hagner v. United States, 285 U.S. 427, 430 (1932).
At issue in the case was whether the presumption should be applied to the mailing of a proof of claim. Courts are split on the question. Some courts have held that a timely mailing of a proof of claim creates a rebuttable presumption that the claim was received and filed by the court.[i] But other courts don’t apply this rebuttable presumption but require actual proof that a claim was timely filed.[ii]
In North Carolina New Schools, Bankruptcy Judge Lena M. James refused to apply this presumption. She noted that “mailing in itself is not filing.” 2020 WL 6891915, at *3. “Creditors with minimal expense or inconvenience, can ensure that a proof of claim is received by the clerk’s office before the deadline for filing their claims electronically or directly at the clerk’s counter, using some form of priority or overnight mail, or calling the clerk’s office to verify the receipt of the claim.” Id.
She added that “[i]n the instant case, there is no dispute that the Claim was filed by the clerk of the court on September 14, 2016, a day after the September 13, 2016 deadline set by this Court for filing proofs of claim. Thus, the Claim cannot be considered timely filed.” Id.
Judge James also noted that because the mailbox presumption is rebuttable, a creditor must introduce more than a self-serving affidavit stating that the proof of claim was mailed before the bar date. Instead, a creditor that asks a court to apply the presumption should submit corroborating evidence, such as a dated cover letter showing transmittal of the proof of claim.
[i] In re Nimz Trans, Inc., 505 F.2d 177 (7th Cir. 1974); Graham v. Judson (In re Graham), 290 B.R. 424 (Bankr. N.D. Ga 2003); In re Pyle, 201 B.R. 547 (Bankr. E.D. Cal. 1996).
[ii] Chrysler Motors Corp. v. Schneiderman (In re Chrysler Motors Corp.), 940 F.2d 911 (3rd Cir. 1991); Oppenheim, Appel, Dixon & Co. v. Bullock (Matter of Robintech), 863 F.2d 393 (5th Cir. 1989); In re Wallace, 277 B.R. 351 (Bankr. N.D. Ohio 2001); In re 5-Off Stores, Inc., 220 B.R. 897 (Bankr. W.D. Tex. 1998).