Maryland Bankruptcy Court proposes rule to address Supreme Court decision on real estate

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Maryland Legal Alert for Financial Services

The District of Maryland Bankruptcy Court recently proposed a new local rule in response to the United States Supreme Court ruling that the mere withholding of bankruptcy real estate by a creditor after the petition does not amount to an exercise of real estate control in violation of the automatic stay.

We recently reported on the eagerly awaited decision of the United States Supreme Court in City of Chicago, Illinois v. Fulton.

Maryland Court’s proposed local rule 7007-1, titled “Motions to Speed ​​Up Motor Vehicle Turnover,” creates an expedited process in adversarial proceedings for motor vehicle rotation.

By request, the applicant may request the accelerated renewal of a motor vehicle if he meets the following conditions:

  1. The petition must specifically identify the motor vehicle, the legal authority supporting the turnover and the justification for the expedited relief, including, in particular, any adequate protection offered to the defendant.
  2. The applicant files an affidavit or affidavit justifying the turnover as to the facts of the application.
  3. The plaintiff must certify that he has spoken with the defendant prior to the turnover claim and made a good faith effort to resolve the dispute in a consensual manner.

Practice point: If passed as proposed, the local rule will come into effect on December 1, 2021. Non-debtors holding motor vehicles at the time of petition should be prepared to negotiate with debtors regarding vehicle turnover motor.


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