Court Opinion

ID: 9484011
Source: CourtListenerOpinion
Date Created: 2023-08-05 09:37:43.645122+00
Date Added: 2024-06-11T17:49:57.611636
License: Public Domain

RIPPLE, Circuit Judge,
dissenting.
I agree with the majority that there are limits on the authority of a bankruptcy court to allow an amendment under Federal Rule of Civil Procedure 151 to a proof of claim. See In re Roberts Farms, Inc., 980 F.2d 1248, 1251 (9th Cir.1992) (stating that Rule 15 liberally permits amendment of proof of claim; however, a court should inquire whether opposing party would be unduly prejudiced by such amendment); In re Unioil, Inc., 962 F.2d 988, 992-93 (10th Cir.1992) (stating same); In re Wilson, 96 B.R. 257, 262 (Bankr. 9th Cir.1988) (noting that in determining prejudicial effect of amendment to proof of claim, court should look to bad faith, unreasonable delay in filing, impact on other claimants, reliance by debtor or other claimants, and change of debtor’s position). I also agree that Rule 15’s concept of “relatedness” is not the only criteria, especially after the plan of reorganization has been confirmed. At that point in the litigation, an amendment to a proof of claim ought to be allowed rarely and only after careful evaluation by the bankruptcy court. That evaluation must take into consideration the reasons for the delay on the part of the creditor and *1272the possibility of prejudice to others involved in the bankruptcy.
However, it is still important to remember that the matter of amendment is committed to the sound discretion of the bankruptcy judge. In the Matter of Stavriotis, 977 F.2d 1202, 1204 (7th Cir.1992). The bankruptcy court, especially in a Chapter 11 proceeding, is engaged in the delicate, complex, and sophisticated task of attempting to breathe life back into the bankrupt entity. The bankruptcy court is therefore in a unique position to appreciate the motivations of the creditors and the impact on the bankrupt estate from an amendment.
This is one of many cases to arrive in this court recently where a matter controlled by the abuse of discretion standard comes to us either unexplained or vaguely explained. This lack of explanation may be due in large measure to the pressures on courts of first instance, including bankruptcy courts, to deal with a great number of cases. However, this failure to communicate adequately with reviewing courts does provide, understandably, a significant unease on the part of appellate courts. It also provides a temptation for appellate courts to micromanage bankruptcy matters.
While prolonging bankruptcy proceedings is indeed regrettable, I believe the appropriate course in a case such as this is to remand the case to the bankruptcy court in order to allow that court to provide us with a more elaborate explanation of its reasons for permitting the amendment. The bankruptcy court did note that Mr. Brill was unable to compute the full amount of his claim when he filed the original proof of claim but left us in the dark as to when such information did become reasonably available to Mr. Brill. The bankruptcy court is also in a far superior position than we to determine the impact of such an amendment on the debtor and on any other remaining creditors.
I believe that remanding this case to the bankruptcy court is far more appropriate than engaging in factual assumptions at the appellate level. The majority concludes that Mr. Brill should have known the total of his legal fees long in advance of his amended filing. The majority also attributes to Mr. Brill a retaliatory motive for filing the amended proof of claim. This sort of fact-finding ought to be done on remand in the bankruptcy court rather than here.
Because I believe the bankruptcy court should have an opportunity to set forth in greater detail the basis of its decision to permit an amendment of Mr. Brill’s proof of claim, I would remand this matter to the bankruptcy court for a more detailed elaboration.

. Bankruptcy Rule 7015 states that Federal Rule of Civil Procedure 15 applies in adversary proceedings.