Adversary Proceedings in Bankruptcy

Illinois Bankruptcy & Debt Relief Attorneys

There are plenty of Chicago consumer lawyers who file bankruptcies, but many of them cannot or will not represent you in adversary proceedings. Most bankruptcy cases are smooth and painless, but what if there is a glitch? What if creditors object? Adversary proceedings can delay or completely derail your bankruptcy or expose your personal assets.

Atlas Consumer Law routinely litigates in U.S. Bankruptcy Court. We make every effort to keep our clients out of court, but we have the experience and proven record in adversary proceedings to protect your interests.

Do you anticipate that your bankruptcy will be challenged? Contact us online or call our Lombard office at (312) 313-1613 to speak with our Illinois debt relief attorneys.

Chicago Bankruptcy Lawyers for Adversary Proceedings

An adversary proceeding is essentially a lawsuit filed within your bankruptcy case. It is initiated by filing a complaint with the bankruptcy court. Only a creditor, a trustee, or the debtor can bring an adversary proceeding. Only certain kinds of matters may be brought as an adversary proceeding.

Defending Debtors in Adversary Proceedings

A creditor may bring an adversary proceeding to keep the court from discharging your debt. This is generally done if the debt falls within one of the exceptions to a discharge or when the creditor believes that the bankruptcy was filed in bad faith. A creditor may claim that you provided false information or incurred the debt in anticipation of bankruptcy. Creditors can seek relief from the automatic stay, which allows them to resume collection efforts and legal proceedings such as foreclosure or repossession.

When a trustee files an adversary proceeding, it is generally because the trustee wants to dismiss the case as a bad faith bankruptcy filing or because the trustee wants to convert the case from a Chapter 7 to a Chapter 13 bankruptcy. Trustees may also use adversary proceedings to claw back payments made to certain creditors before bankruptcy case filed. A Chapter 7 trustee may use an adversary proceeding to return property to the bankruptcy estate.

In general, so long as you are honest with your attorney, and disclose all of your financial affairs, you will not see an adversary proceeding filed in your bankruptcy case. In the event that your petition is challenged, our experienced bankruptcy litigators can represent you.

Initiating Adversary Proceedings Against Creditors

Debtors can also bring adversary proceedings. These are almost always brought against creditors for violations of the automatic stay or the discharge injunction. Generally, an adversary proceeding brought for a stay or discharge violation will also contain other claims based on federal and state law. Your attorney can tell you which claims are available to you. If your creditors are harassing you during or after your bankruptcy case, you have the right to file an adversary proceeding. Doing so protects your rights and can result in your collecting damages for the creditor's misconduct.

As with any lawsuit, simply filing an adversary proceeding does not guarantee victory. You must prove the elements of your claim. Fortunately, the same goes for creditors and trustees who file adversary proceedings against you. Adversary proceedings can be powerful tools for protecting your rights. If you think that you have a claim against one of your creditors, notify your bankruptcy attorney.

Contact our office online or call (312) 313-1613 for skilled advocacy in adversary proceedings.

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