What Is An Adversary Proceeding In Bankruptcy Court?

October 2, 2008

You’ve filed for bankruptcy and you’ve been granted a discharge from all of your debts. You’ve been given an opportunity to begin anew. Just as things are looking up, you receive a letter from a collections agency about a debt that was discharged in the bankruptcy. You notify the collectors of the discharge, yet they persist in harassing you.

What are your options?

If the creditor was listed on your bankruptcy papers, you need to file an adversary proceeding.

An adversary proceeding is a lawsuit filed by one party (the plaintiff) against another (the defendant). In this way, it is very similar to a civil lawsuit. There are three parties that have the ability to file an adversary proceeding. These are the creditor, a trustee, or the debtor. Creditors will sometimes file an adversary proceeding to dispute the discharge of a debt. A trustee may file against a creditor to get certain property or money back from a creditor. The debtor can file against a creditor if there has been a violation of the automatic stay or the bankruptcy discharge.

If you can prove the collections agency or debtor knowingly disregarded the discharge, the court will often award damages. These can include legal fees and, in some cases, emotional damages. The required proof is why keeping a running record of correspondence is important. If an old debt that was not listed is the focus of the collections agency, you must notify the collector of the bankruptcy. If that agency continues to harass you over a debt that you don’t owe, you need to take action.

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