![]() ![]() In a Chapter 13 bankruptcy, a debtor may achieve dismissal simply by electing not to make payments to the Chapter 13 Trustee. In a Chapter 7 bankruptcy, one must generally seek approval of the bankruptcy judge in order to receive a dismissal of the bankruptcy. ![]() ![]() In a Chapter 7 bankruptcy, dismissal of the bankruptcy is much more difficult than in a Chapter 13 bankruptcy. May such a debtor escape the ramifications of a judgment of non-dischargeability of the debt subject to such an adversary proceeding by simply dismissing the bankruptcy? Section 349 of the bankruptcy code will provide for the dismissal of the adversary proceeding unless sufficient cause is shown. If the debtor defends the adversary proceeding, the attorney fees necessary for such defense may be beyond the financial capabilities of the debtor. If the debtor decides not to defend the adversary proceeding, a default judgment may be entered against the debtor, and the debt will be deemed unworthy of discharge. Although there may be no merit to the adversary brought by the creditor, the debtor is placed in an uncomfortable position. Some creditors may file an adversary proceeding based upon a spurious basis. In both instances, generally, an adversary proceeding must be filed in order for such debts to receive a finding of non-dischargeability. For example, if the debt was incurred because of willful or malicious actions or conduct of the debtor, or based upon fraudulent conduct, such debt may be determined not dischargeable. If a bankruptcy court judge finds that the character of a property settlement is in the form of a domestic support obligation, then such debt cannot be discharged in bankruptcy.Ī debt may also be found to not be dischargeable based upon the conduct of the debtor. For example, a creditor may object to the discharge of a debtor’s obligation pursuant to a property settlement obligation contained in an order of dissolution of marriage, or divorce, or a property settlement agreement, may in fact be a domestic support obligation. If a debtor files Bankruptcy, whether a Chapter 7 or Chapter 13 Bankruptcy, does an adversary proceeding filed against the debtor, subsequently result in the dismissal of the adversary proceeding? Some debtors who file a consumer form of bankruptcy, such as a Chapter 7 or Chapter 13, may expectantly or unexpectantly find themselves a defendant in an adversary proceeding.Īn adversary proceeding is an action filed in the bankruptcy court in which a creditor objects to the dischargeability of a certain debt based upon either the nature of the conduct or arising from the conduct of the debtor in reference to such debt. ![]()
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