The Federal Rules of Bankruptcy Procedure contain time limits by which banks and other creditors may file objections to exemptions claimed by a debtor. The timing issue is more complex, however, when a Chapter 11 case is converted to a Chapter 7 case. This article explains the impact of a recent decision by the U.S. Court of Appeals for the Second Circuit, adopting a minority view, on this issue.
The Second Circuit Court of Appeals recently decided a case that will substantially alter the dynamics involved in bankruptcy proceedings filed under Chapter 11 in this jurisdiction. In Bell v. Bell,1 the court held that the conversion of an individual debtor's bankruptcy from Chapter 11 to Chapter 7 does not trigger a second thirty-day period in which the trustee or creditors may timely object to claimed exemptions pursuant to Rule 4003(b)2 of the Bankruptcy Code.3 In so concluding, the court rejected the bulk of authority on this issue.4 In an emphatic opinion, the Bell court repudiated
