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Unclaimed Funds

Local Rule Number: 
Rule 3011-1
3000 Series

(A)       Deposit by Chapter 7, 12, or 13 Trustee.  The chapter 7, 12 or 13 trustee shall deposit with the court any funds left undistributed pursuant to Bankruptcy Rule 3011, accompanied by the Local Form “Notice of Deposit of Funds with the U.S. Bankruptcy Clerk”.

[Comment: See also 11 U.S.C. §347(a) (deposit of unclaimed funds after final distribution).]

(B)       Disposition of Unclaimed Funds Under A Chapter 11 Liquidating Plan.

(1)        The disbursing agent under a chapter 11 plan which provides for the complete liquidation of the property of the debtor shall, when making final distribution under the plan:

(a)        Notify such entity, if any, that purchased all of the debtor’s assets under the chapter 11 plan, of its potential right to the unclaimed funds to the extent the disbursing agent can identify such an entity.

(b)       Unless the plan otherwise provides, pay over to the court any funds left unclaimed 120 days after the final distribution under the plan, accompanied by the Local Form “Notice of Deposit of Funds with the U.S. Bankruptcy Clerk”.

(c)        File a final account under 11 U.S.C. §1106(a)(7), prior to the expiration of time provided in 11 U.S.C. §1143, and all other reports required by Local Rule 3022-1.

(2)        A chapter 11 liquidating plan may provide that any unclaimed funds may be redistributed to other creditors or administrative claimants or donated to a not-for-profit, non-religious organization identified in the plan or disclosure statement accompanying the plan.

 (C)       Disposition of Undistributable Funds Under a Chapter 11 Liquidating Plan.

(1)        Undistributable funds are any funds other than unclaimed funds, including, but not limited to, funds that cannot be disbursed because: (a) a creditor has affirmatively rejected a distribution, (b) the administrative costs of distribution effectively interfere with distribution, or (c) all creditors, including administrative claimants, have been paid in full and there is no one that has a right to the funds.

(2)        A chapter 11 liquidating plan may provide that any undistributable funds, if applicable or practicable, may be redistributed to other creditors or administrative claimants or donated to a not-for-profit, non-religious organization identified in the plan or disclosure statement accompanying the plan.

(3)        If a chapter 11 liquidating plan does not provide for the disposition of undistributable funds then, if there are any such funds at the time of final distribution under the plan, the disbursing agent shall file a motion, upon notice and hearing, proposing disposition of such funds, including as described in subdivision (C)(2) of this local rule.

[Comment: Compare 11 U.S.C. §347(b) (return of unclaimed funds to debtor in reorganization cases).]

(D)       Withdrawal of Unclaimed Funds.  The court shall consider a request for withdrawal of unclaimed funds submitted in accordance with the “Clerk’s Instructions for Deposits Into and Withdrawal From Unclaimed Funds”.