Houston Bankruptcy Attorney
Case Closing and Reopening
After an estate is fully administered and the court has discharged the trustee, the court shall close the case. The Rules of Bankruptcy Procedure provide the procedure for case closing.
If in a Chapter 7, Chapter 12 or Chapter 13 case, the trustee has filed a final report and final account and has certified that the estate has been fully administered, and if within 30 days no objection has been filed by the United States Trustee or a party in interest, there is a presumption that the estate has been fully administered. The final report and account of the trustee is required to be filed with the court and the United States Trustee.
A case may be reopened in the court in which the case was closed to administer assets, to accord relief to the debtor, or for other cause. Though the court may permit reopening of a case so that the trustee may exercise an avoiding power, laches may constitute a bar to an action that has been delayed too long.
A case may be reopened on motion of the debtor or other party in interest under the Bankruptcy Code. In a Chapter 7, 12, or 13 case, a trustee shall not be appointed by the United States Trustee unless the court determines that a trustee is necessary to protect the interests of creditors and the debtor or to insure efficient administration of the case.
The Federal Rules of Civil Procedure exempt motions to reopen cases under the Code from the one-year limitation. Although a case has been closed the court may sometimes act without reopening the case, such as when there are clerical errors in judgments, orders, or other parts of the record or errors therein caused by oversight or omission may be corrected.
A judgment determined to be non-dischargeable may be enforced after a case is closed by a writ of execution. In order to avoid unnecessary cost and delay, a case may be reopened without the appointment of a trustee when the services of a trustee are not needed.
The United States Trustee has the duty to appoint trustees in Chapter 7, 12 and 13 cases. In most reopened cases, a trustee is not needed because there are no assets to be administered. A motion is not necessary unless the United States Trustee or a party in interest seeks the appointment of a trustee in the reopened case.