Mr. Detzky has been engaged in consumer and business bankruptcy in New Jersey for more than 30 years. He served as a Chapter 7 Bankruptcy Trustee in the United States Bankruptcy Court for the District of New Jersey for over 15 years. His dual experience as both a seasoned bankruptcy practitioner and former bankruptcy trustee affords him the unique perspective of evaluating  your case from both sides and minimizes the potential for any unexpected problems with your case.

Under Bankruptcy Rules, an adversary proceeding may be filed in a debtor's bankruptcy action for certain specific reasons. Creditors may initiate adversary proceedings to determine the validity or priority of a lien, to determine the validity of a debt, to obtain an injunction, or to subordinate a claim of another creditor. The debtor in possession may institute an adversary proceeding to recover money or property for the estate. Also, a creditors' committee may be authorized by the bankruptcy court to pursue certain actions that the debtor has failed to pursue. An adversary proceeding is a lawsuit filed within a bankruptcy case. The proceeding takes place in the bankruptcy court and is tried by the bankruptcy judge.

Definition of Adversary Proceeding

''Adversary proceeding'' is defined by the Bankruptcy Rules as a proceeding before a bankruptcy judge for legal, equitable or declaratory relief that arises under applicable law. Such proceedings are governed by bankruptcy rules, which incorporate by reference, adopt in part, or adapt most of the Federal Rules of Civil Procedure. In the ordinary adversary proceeding the pleadings will consist only of a complaint and an answer.

Any of the following proceedings are considered adversary proceedings:

1. to recover money or property, except certain proceedings including those to compel the debtor to deliver property to the trustee;

2. to determine the validity, priority, or extent of a lien or other interest in property, other than a proceeding involving liens impairing debtor's exemptions;

3. to obtain approval for the sale of both the interest of the estate and of a co-owner in property;

4. to revoke an order of confirmation of a Chapter 11, Chapter 12 or Chapter 13 plan;

5. to determine the dischargeability of a debt;

6. to obtain an injunction or other equitable relief;

7. to subordinate any allowed claim or interest, except when subordination is provided in a Chapter 9, 11, 12 or 13 plan;

8. to obtain a declaratory judgment relating to any of the foregoing; or

9. to determine a claim or cause of action removed pursuant to the United States Code.

Initiating an Adversary Proceeding

Adversary proceedings are initiated by filing a complaint with the court to resolve both federal and state law issues.

Objecting to the Discharge of a Debt

Objections in bankruptcy cases occur most often when a creditor is alleging that a debt should not be forgiven or discharged because of fraud, but it can also happen if a creditor thinks the debtor is abusing the system, has not disclosed assets, or has not fairly characterized its claim. A debtor or any creditor may file a complaint to obtain a determination of the dischargeability of any debt. In a Chapter 7, 11 or 12 case, a complaint to determine the dischargeability of any debt must be filed not later than 60 days following the first date set for the meeting of creditors held pursuant to Section 341(a). The court must give all creditors not less than 30 days notice of the time. On motion of any party, after hearing on notice, the court may for cause extend the time, but the motion must be made before the time has expired. If the creditor prevails, the debt or claim is declared to be non-dischargeable by the bankruptcy court, and the creditor may attempt to recover the debt under state laws that may apply.

* Michael L. Detzky, Esq. - Over 30 years New Jersey Bankruptcy Experience - 732.780.3090 *

Common Questions on Bankruptcy

What is a Debtor?

In its most basic form, a debtor is a person who owes someone else money. A creditor is the person who is owed money. For example, If John loans Mary fifty dollars, then John is the creditor of Mary, and Mary is the debtor of John.

What is Bankruptcy?

Bankruptcy is the legal method for a debtor to "discharge" or relieve himself of the debts that he owes. While no debtor is guaranteed a total discharge of his debt, most debtors who file for bankruptcy are given such relief. One of the primary purposes of the bankruptcy act is to relieve the honest debtor from the weight of oppressive indebtedness and to provide the debtor with a fresh start. 

Who can file for bankruptcy?

Any person can file for bankruptcy protection from creditors. In addition, most businesses and charitable organizations may also qualify for bankruptcy protection.

What happens to my bills after I file for bankruptcy?

As soon as your case is officially filed with the court, creditors are legally prevented from attempting to collect on any debt owed to them by you. This means that creditors must stop all collection activity, including: telephone calls, harassing letters, repossessions, foreclosures, lawsuits, and wage garnishments. Once the case is concluded, the court may enter a "discharge". A discharge is a total release of a debtor from any further personal liability for his or her pre-bankruptcy debts.

What is the difference between Chapter 7, 11, and 13 bankruptcy?

In a typical Chapter 7 bankruptcy (also known as liquidation), a trustee collects the nonexempt property of the debtor, converts the property to cash, and distributes the cash to the creditors. In contrast, Chapters 11, 12, and 13 of the Bankruptcy Code contemplate debtor rehabilitation. In a rehabilitation case, creditors look to future earnings of the debtor, not to the current property of the debtor. Under rehabilitation, a debtor will generally retain his assets and property, while making payments to creditors pursuant to a court approved plan.

Will filing bankruptcy effect my credit rating?

Unfortunately it will. However, most individuals are able to rebuild their credit within a few years. If you are currently contemplating bankruptcy, then it is likely that your current credit rating has already been effected. A discharge of your current debt may provide the opportunity to rebuild your credit with steady, regular payments on a new account.

How long will a bankruptcy show on my credit reports?

The Fair Credit Reporting Act prohibits the reporting of outdated information about consumers. With a few exceptions, credit-reporting agencies can only disclose a bankruptcy during the first ten years following a filing.

Will I lose my house, car, and other personal property?

Section 522 of the Bankruptcy Code provides very liberal "exemptions" so no assets are lost to creditors in most cases. The Code affords debtors a "Fresh Start" free of debt and creditor calls, and with assets and the right to earn and save money in the future as if no bankruptcy were filed. The exemptions are as follows:

When you meet with Mr. Detzky he will fully explain which "Exemptions" will apply in your particular case and all the real and personal property you will keep if you decide to file a bankruptcy case.

Should I file for bankruptcy?

The decision to file bankruptcy should only be made after you have consulted with an experienced bankruptcy attorney and thoroughly discussed all of your available options. The Law Offices of Michael L. Detzky offer a free and confidential office consultation to individuals contemplating bankruptcy. Call us today at (732) 780-3090 to arrange for your appointment. Mr. Detzky will discuss other ways you can start to rebuild your credit after bankruptcy.

* Michael L. Detzky, Esq. - Over 30 years New Jersey Bankruptcy Experience - 732.780.3090 *

Is There Life After Bankruptcy? What You Can Expect

 
At first, its a a relief -- you file bankruptcy, and the creditors stop harassing you. Your phone stops ringing, you're no longer afraid to pick up the mail, and the juggling act ends. You can devote your income to keeping up your living expenses and trying to get your financial life back on track.

But many people who file bankruptcy are worried about what comes next. They've heard rumors like, "You can't get credit for ten years after you file bankruptcy."

Naturally, when you've just filed bankruptcy, your credit won't be strong. Of course, your credit probably wasn't strong when you were dealing with the crises that forced you to file bankruptcy, so that's nothing new.

Stepping back into the world of finances without the burden of insurmountable debt is a great feeling, some say it's a gift. The most important thing to do is keep your self on the right track; make the right decisions, be credit smart. Here are some things you should know about life after bankruptcy to help you avoid the credit traps you will most likely encounter after your discharge.

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