Adversary Proceedings

At The Sellers Law firm, our experienced Montgomery bankruptcy attorneys and Selma bankruptcy attorneys work on adversary proceedings cases on a daily basis. An adversary proceeding is just as simple as it sounds – it’s when someone is fighting with someone else in bankruptcy court. An adversary proceeding is simply a trial in front of the bankruptcy judge, and the bankruptcy judge will decide in the matter. The creditor, the bankruptcy trustee, or the debtor are the only three parties who can bring an adversary proceeding.

The most common form of an adversary proceeding is one that is brought by a creditor. The creditor is usually arguing that the debt owed to the creditor should not be discharged in the bankruptcy judge. The creditor argues that this debt falls within one of the exception rules to a discharge. These would be such debts that were created through fraud, willful or malicious injury, or because of a personal injury caused by drunk driving for example. However, mainly the creditor argues that the filing of the bankruptcy case by the debtor was done in bad faith. When a creditor argues that the client’s bankruptcy case was filed in bad faith, the creditor is arguing that the client has been dishonest and not told the court everything about their situation. It is an absolute must that a debtor tells his attorney everything that might impact the ability to get a discharge.

At The Sellers Law Firm our bankruptcy attorneys always advise our clients to tell us in advance of all of their debts, their assets, their income, and any type of special situations that they may have concerning their finances. There is no such thing as too much information about our new clients! It makes it much easier to deal with issues “head on” than to learn about things when it’s too late to make corrections or changes. If you need help, then please call or text us today. All consultations are free, and our phones are answered 24 hours a day! Call or text us today at 334-LAWYERS (529-9377) or use the Contact Form on our website.

A second kind of type of adversary proceeding is filed by the Chapter 13 or Chapter 7 trustee. Generally, the trustee may argue that schedules were not completed correctly, or the debtor was intentionally fraudulent. The trustee may ask that the bankruptcy case be dismissed. The trustee may also file an adversary proceeding to try to collect money back from a creditor who received funds or property from a debtor. In rare occasions, the trustee may file an adversary proceeding to force the debtor to convert from a Chapter 7 to a Chapter 13 if the trustee believes that the filing of the bankruptcy petition was done in bad faith. This really means that the trustee believes that the debtor is trying to abuse the bankruptcy system.

Finally, and most commonly, a debtor may file an adversary proceeding against a creditor. The debtor usually alleges that the creditor’s actions were in violation of the automatic stay as defined by the US Bankruptcy Code. The second most commonly seen adversary proceeding filed by a debtor is one in which the debtor alleges that a creditor has violated the discharge injunction after a case or bankruptcy has been discharged. In these types of cases the debtor is asking that the creditor pay him monetary damages and attorney fees for the violation committed.

As in any type of legal action, just because an adversary proceeding is filed does not mean that the party filing the adversary proceeding is going to win. It truly depends on a hearing or trial, and it is at the judge’s discretion to determine who is right and who is wrong based upon current case law and the bankruptcy code. It is the job of the debtor’s attorney to advise the debtor as to the likelihood of success in any adversary proceeding, but as in any case it is the judge ultimately decides the case.

Our experienced Montgomery bankruptcy attorneys and Selma bankruptcy attorneys can advise you on any adversary proceeding that may arise in your bankruptcy. We have four convenient locations in Montgomery, Selma, Greenville, and Troy. All consultations are always free, and we can usually meet with you within 24 hours! You may contact us at bsellers@sellerslawfirm.com. You may set an appointment by calling or texting us at 334-LAWYERS (334-529-9377) or use the Contact Form on our website. Remember that doing nothing changes nothing so act today!