576 B.R. 552
Bankr. E.D. Mich.2017Background
- Jerome Collins sought leave to file a proof of claim more than three years after the Court’s February 21, 2014 claims bar date, asserting claims arising from his suspension, termination, and related monetary relief.
- The Detroit Police Officers Association (DPOA) filed an omnibus proof of claim on February 20, 2014 that listed Collins’ grievance (no. 12-0137) as pending arbitration; that grievance was in fact decided against Collins by a binding arbitration award issued February 7, 2014.
- The DPOA later acknowledged in writing that the arbitration decision concluded and closed the claim filed on Collins’ behalf.
- After the arbitration loss, Collins filed a district court action (May 15, 2015) seeking injunctive and monetary relief; the bankruptcy court ordered Collins to dismiss claims against the City as barred by the confirmed plan.
- Collins then moved (Dec. 30, 2016) either to amend the DPOA’s timely claim or to file his own late proof of claim asserting the district-court claims; the City opposed.
- The Court treated the motion as a request to permit a late-filed claim and denied it, concluding Collins failed to show excusable neglect under Fed. R. Bankr. P. 9006(b)(1).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| May Collins amend the DPOA’s timely-filed proof of claim to add/replace his own claims? | Collins sought to amend the DPOA claim to include his claims. | City: one party cannot amend another party’s proof of claim. | Denied — no legal basis for one party to amend a different party’s claim. |
| May Collins be permitted to file a proof of claim after the bar date? | Collins asked the Court to allow a late claim to pursue his prepetition employment and damages claims. | City: Collins must satisfy excusable neglect under Rule 9006(b)(1); late filing years after bar date prejudices the estate and plan. | Denied — Collins failed to show excusable neglect under Pioneer factors. |
| What standard governs late proofs of claim in Chapter 9? | Collins did not dispute that excusable neglect applies. | City argued Pioneer/Rule 9006(b)(1) governs late claims in non-debtors’ favor. | Court: Rule 9006(b)(1) excusable neglect standard applies (Pioneer governs). |
| Were Collins’s stated reasons (financial hardship, reliance on union, alleged stay violation, lack of awareness) valid excuses? | Collins claimed financial inability, reliance on union representation, alleged stay violation, and lack of knowledge of ability to file. | City: reasons insufficient; Collins had counsel, could file pro se, had notice; reliance on union was a choice; alleged stay violation irrelevant to late filing. | Court: Reasons not credible or persuasive; delay was within Collins’s control and inexcusable. |
Key Cases Cited
- Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd. P’ship, 507 U.S. 380 (1993) (excusable neglect governs late proofs of claim and sets equitable factors).
- New York City Hous. Auth. v. G-I Holdings, Inc. (In re G-I Holdings, Inc.), 514 B.R. 720 (Bankr. D.N.J. 2014) (application of excusable neglect to late claims context).
- Omni Mfg., Inc. v. Smith (In re Smith), 21 F.3d 660 (5th Cir. 1994) (Rules 3003(c)(3) and 9006(b)(1) read together; Pioneer controlling).
- In re Sharkey, 560 B.R. 470 (Bankr. E.D. Mich. 2016) (discussion of Pioneer and excusable neglect analysis).