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What is an Adversary Proceeding in a Bankruptcy?

Most people file for bankruptcy because they want to avoid lawsuits. However, even in a bankruptcy, law suits can be filed and these are called adversary proceedings. It comes about because one of the parties involved has filed a complaint. This could be any one of the creditors involved. It could be you or your trustee. It may be that you or your trustee disagrees about a matter that is being handled in your bankruptcy.

The Bankruptcy Process

Once this type of proceeding comes into play it is still part of your bankruptcy action. It will be assigned a separate case number. What an adversary proceeding means is that a judge will get involved and reach a ruling over the matter. There are several formal proceedings that have to be taken in order to bring an adversary proceeding to court. Your bankruptcy lawyer will certainly handle this matter and advise you as to what is going to take place concerning the matter.

There are many different reasons why any of the parties involved in your bankruptcy case may file an adversary proceeding. Some of these reasons are more common than others. The complaint could be based on your actions two years prior to your bankruptcy proceedings. For example, if you transferred any of your property or money to another individual, the trustee may make allegations of some type of fraud. Potential payments that you may have paid to creditors or family members may become a point of contention.

These are just a few of many possibilities and your Louisville bankruptcy lawyer will be fully aware of them, and will act accordingly on your behalf.

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