Amend adversary complaint in United States Bankruptcy Court

Amending an adversary complaint in United States Bankruptcy Court is the topic of this blog post.  It should be noted that the cases mentioned below are from the Ninth Circuit Court of Appeals, and a reader who is located in a state that is located in another circuit should research the cases for their particular circuit.

Federal Rules of Bankruptcy Procedure 7015 and 7016 expressly provide that Rules 15 and 16 respectively, of the Federal Rules of Civil Procedure apply in bankruptcy proceedings.

Rule 15 of the Federal Rules of Civil Procedure ("FRCP") states in pertinent part that,

"A party may amend its pleading once as a matter of course within:

(A) 21 days after serving it, or

(B) if the pleading is one to which a responsive pleading is required, 21 days after service of a responsive pleading or 21 days after service of a motion under Rule 12(b), (e), or (f), whichever is earlier.

(2) Other Amendments. In all other cases, a party may amend its pleading only with the opposing party's written consent or the court's leave. The court should freely give leave when justice so requires."

And the claims in the first amended adversary complaint relate back to the original complaint if they assert claims arising out of the conduct, transactions and occurrences that were set out, or attempted to be set out in the original complaint. See FRCP Rule 15[c](1)(B).

The Ninth Circuit Court of Appeal has stated that leave to amend should be granted unless   amendment would cause prejudice to the opposing party, the amendment is sought in bad faith, amendment is futile, or creates undue delay.

However, the situation changes once the Court has issued a pre-trial scheduling order. Once a pre-trial scheduling order has been issued the Court must look to the pre-trial scheduling order to determine what standards to apply to any motion to amend. If no pre-trial scheduling order has been issued which makes any mention of any timetable for amending pleadings then a good argument can be made that the more liberal standards of Rule 15 should apply.

The policy of Rule 15 favoring amendment is applied liberally by the Ninth Circuit Court of Appeals although that leave to amend can be denied where plaintiff has previously amended their complaint. Thus it is very critical that a party seeking leave to amend their original complaint ensure that their amended complaint does in fact state a claim.

Attorneys or parties who would like to view a portion of a sample motion for leave to amend an adversary complaint containing a memorandum of points and authorities with citations to case law and statutory authority, sample declaration and proof of service by mail sold by the author can use the link shown below.

http://www.scribd.com/doc/57486354/Sample-Motion-for-Leave-to-Amend-Adversary-Complaint

The author of this blog post, Stan Burman, is an entrepreneur and freelance paralegal who has worked in California and Federal litigation since 1995 and has created over 300 sample legal documents for California and Federal litigation.

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DISCLAIMER:

Please note that the author of this blog post, Stan Burman is NOT an attorney and as such is unable to provide any specific legal advice. The author is NOT engaged in providing any legal, financial, or other professional services, and any information contained in this blog post is NOT intended to constitute legal advice.

The materials and information contained in this blog post have been prepared by Stan Burman for informational purposes only and are not legal advice. Transmission of the information contained in this blog post is not intended to create, and receipt does not constitute, any business relationship between the author and any readers. Readers should not act upon this information without seeking professional counsel.