Understanding Adversary Proceedings
Many people who go through bankruptcy never go through an adversary proceeding, while others might experience several. As the name implies, a bankruptcy case enters an adversary proceeding when there is a disagreement that can otherwise not be resolved. Nearly any party in the bankruptcy process could file an adversary proceeding. This is done when a party feels that his or her rights – or the rights of the entity he or she is representing – are not being protected.
Examples of Adversary Proceedings
So what does it really mean if someone files for an adversary proceeding? In general, it means that the creditor, bankruptcy trustee, or debtor believes that their interests are being unfairly ignored. In essence, it is a way for the court to pause the bankruptcy proceeding to make sure that everyone is being treated justly. The following are just a few examples of adversary proceedings:
- The United States bankruptcy trustee or the chapter trustee might file if they think that the debtor is providing fraudulent information. They could also file due to a debtor’s failure to report to court on time or because of clerical errors. In these situations, the bankruptcy trustee is seeking to end the bankruptcy proceedings.
- The debtor in the case can file for adversary proceedings if he or she believes that a creditor has not been adhering to debt collection laws. If you are the debtor in a bankruptcy case and believe that your creditors broke the law in seeking debt repayment, you should discuss this with a bankruptcy attorney.
- A creditor could also file if they believe for some reason that their debt should not be discharged. However, these cases are uncommon, since the law outlines clearly which debts should be discharged and which should not.
Both sides have a chance to present their opinions in an adversary proceeding, and then a judge rules in favor of one side or the other.
Contact Us
Adversary proceedings can be key to getting a beneficial outcome in your bankruptcy case. Contact a West Palm Beach bankruptcy attorney at Eric N. Klein & Associates, P.A., at 561-353-2800 today for assistance with your adversary proceeding.
