Opinion ID: 583437
Heading Depth: 2
Heading Rank: 2

Heading: Informal Proof of Claim

Text: 34 The BAP ruled alternatively that even if section 106 does condition a waiver of sovereign immunity on the filing of a claim, the government nonetheless waived its immunity in this case by asserting an informal proof of claim. We have held that even though no document is filed with the bankruptcy court, an informal proof of claim may arise out of demands against the estate or out of correspondence between a creditor and the trustee or debtor-in-possession which demonstrate an intent on the part of the creditor to assert a claim against the bankruptcy estate. See In re Anderson-Walker Indus., Inc., 798 F.2d 1285, 1287-88 (9th Cir.1986). Relying on Anderson-Walker, the BAP stated: 35 We conclude that the defendants' affirmative actions after the bankruptcy filing, namely offsetting their claim against estate assets, and giving notice to the debtor of such offset, were the equivalent of asserting an informal proof of claim. Implicit in such actions was the assertion of a claim. The offsetting and notice accomplished more than a mere proof of claim, having actually effected collection of the asserted clam. Since the defendants' action was at least equivalent to the submission of an informal proof of claim, sovereign immunity would be deemed waived even if § 106(a) conditioned the waiver of sovereign immunity on the government's filing of a proof of claim. 36 112 B.R. at 334. 37 The Secretary maintains that the informal proof of claim doctrine was misconstrued by the BAP and has no relevance to this case. Observing that the doctrine was developed as an equitable rule to mitigate the harsh consequences of failing to meet filing deadlines, the Secretary contends that the BAP turned the doctrine on its head and converted it into a trap for unwary creditors. The Secretary asserts that where a creditor subsequently does not pursue a bankruptcy court claim, any demand against the estate has no legal status and therefore does not invoke the court's jurisdiction. We disagree. The government cannot have it both ways: it cannot obtain post-petition payment from the estate through offsetting and still maintain immunity from suit by electing not to file a formal proof of claim. The Secretary would have us construe the doctrine so as to give the government the luxury of being able to assert an amendable informal proof of claim, and then wait and see whether it would be more advantageous to file a formal claim and risk exposure to counterclaims or simply to take the money and run with its immunity intact. Such a holding would vitiate the purpose of section 106(a), which is to prevent a governmental entity from obtaining distribution from the estate without subjecting itself to claims by the debtor arising out of the same transaction or occurrence.