Sale - Free and Clear of Liens

MOTION FOR SALE FREE AND CLEAR OF LIENS
 
Overview:                               

PLEASE READ CAREFULLY THIS IS A TWO-STEP (2) PROCESS

A sale of property free and clear of liens may be commenced by motion and must conform with F.R.B.P. 9014.  A sale free and clear of liens is also subject to the additional noticing requirements of L.B.R. 6004-5. When a motion is filed for a sale free and clear of liens, the clerk will issue an order fixing a 14 day response date and a hearing date. A hearing will be held only if a responsive pleading is timely filed, requested by the moving party, or ordered by the court. Otherwise an order granting the relief will be entered without a hearing. This filing should be accompanied by the Motion and Proposed Order.

After the order is issued by the Clerk setting a response and hearing date, the movant must serve the Motion along with a copy of the Scheduling Order on all respondents named in the Motion claiming an interest in the property. A Certificate of Service must be filed evidencing the Motion and Scheduling Order were served on all respondents. Next the movant must prepare and docket a Notice of Sale, which conforms in content to L.B.R. 6004-1(c). A Certificate of Service must also be filed evidencing the Notice of Sale was served on all creditors and applicable parties pursuant to LBR 6004-1(d) & (e) at least twenty-one (21) days before the hearing on the sale.

Property of the estate cannot be sold without a general notice pursuant to U.S.C. Section 363. 

A sale of property free and clear of liens must be filed as adversary proceeding and commenced by a complaint when the seller seeks to also:

(1)   Determine the validity, priority, or extent of a lien or other interest in the property other than the avoidance of a lien or other transfer of exempt property under 11 U.S.C. Section 522(f); or

(2)   Obtain approval under 11 U.S.C. Section 363(h) for the sale of both the interest of the estate and of a co-owner in the property unless the concurrence of the co-owner has been obtained.

For order format, please see Proposed Orders
 
 
Codes, Rules and Forms:
 
Bankruptcy Code:
Bankruptcy Rule:
Local Rule:
Local Form:
None
 

CM/ECF Event(s):
            Motions/Application/Contested Matters, Use, Sale, Lease or Prohibit or Condition of Property
            Miscellaneous, Notice of Use, Sale, Lease or Prohibit or Condition of Property
 
I.     Noticing:
 

A.       Type:     Motion and Scheduling Order - must be served upon all lienholders and other parties claiming interest in the property and their counsel of record. (The hearing will be scheduled no sooner than twenty-five (25) days after the filing of the motion.)

                         Notice of Sale - prepared and filed by the movant which conforms in content with L.B.R. 6004-1(c) must be served on all creditors and applicable parties in interest pursuant to L.B.R. 6004-1(d) at least twenty-one (21) days before the hearing on the sale.

B.       Who Serves:  Movant -- Court if filed by Trustee or UST

C.       Service:           Matrix, T, UST, COMM, US FRBP 2002(j), and all holders of liens or encumbrances against the property (L.B.R. 6004-1(d))