Creditors and Bankruptcy

Creditors and Bankruptcy

The vast majority of bankruptcy filings are straight-forward cases in which 99% of the time, the client files their petition and gets a discharge in about 90 days, with no objection filed by creditors. However, at times a creditor files an objection – called an adversary proceeding – which results in litigation. Now, the debtor must defend the lawsuit and requires the services of a bankruptcy trial attorney.

I recently successfully defended just such a lawsuit. My client had a creditor that claimed their debt should not be included in the bankruptcy due to alleged fraud. Instead of this case ending in 90 days, we are now embroiled in our fifth year of litigation. When you select a bankruptcy attorney, you should be sure that he or she is experienced in defending such a scenario.

A good attorney will anticipate that certain creditors in a particular case may challenge the bankruptcy and should advise the client before the case is filed. Proper preparation will result in no surprises and the client will be prepared to deal with any stumbling blocks.