One thing that most people don't really understand about Indiana bankruptcy is an adversary proceeding. To put it simply, an adversary proceeding is a lawsuit filed in a bankruptcy case that asks the court to determine that a debt is or is not dischargeable. Most commonly an adversary proceeding is filed by a creditor who believes that his or her debt should survive bankruptcy because the debt was incurred through fraud, misrepresentation or due to willful and malicious injury. An adversary proceeding is a case affiliated with the underlying bankruptcy proceeding, but it is assigned an additional cause number. The adversary proceeding typically continues even after the debtor has received a discharge through the typical stages of litigation including discovery, dispositive motions, depositions and finally a trial, if necessary. Even if a debtor has filed his or her bankruptcy petition pro se without an attorney, a debtor who receives a complaint in an adversary proceeding will typically benefit from counsel in that adversary proceedings are complex and it would be very difficult for a non-attorney to navigate through the procedure of an adversary proceeding.
The reality is that most folks I meet with at Halcomb Singler, LLP, regarding bankruptcy are going to get through their bankruptcy proceeding without any creditor filing an adversary proceeding. Adversary proceedings are fairly rare because the burden is on the creditor to show why a debt should not be discharged in bankruptcy. In addition, it is expensive to hire an attorney to file and litigate an adversary proceeding. Creditors may also opt not to file an adversary proceeding because they do not want to throw good money after bad. After all, if a creditor wins an adversary proceeding it means that the debt has not been discharged in bankruptcy, but it does not magically cause the debtor to have the money to repay the debt. Often actually collecting a debt is the hardest part for a creditor.
As I stated earlier, most debtors are going to get through their bankruptcy proceeding and obtain a discharge without the filing of an adversary proceeding. In fact, a bankruptcy attorney will typically be able to tell whether there is much likelihood of the filing of an adversary proceeding after you tell him or her the story of what led you to make an appointment with a bankruptcy attorney. However, in my opinion debtors should understand that something called an adversary proceeding exists and understand that defense of an adversary proceeding is typically not included in the flat fee charged by most bankruptcy attorneys.
If you are contemplating bankruptcy, live in central Indiana/Indianapolis and surrounding areas and would like to meet regarding whether or not Chapter 7 or Chapter 13 Bankruptcy would be beneficial to your situation please call 317-575-8222 for a free initial consultation. Halcomb Singler also represents both creditors and debtors in adversary proceedings in bankruptcy court.
Halcomb Singler, LLP, is a debt relief agency. It helps people file for bankruptcy under the bankruptcy code. No attorney-client relationship with the firm of Halcomb Singler, LLP, is created through this blog. Also, please note that Erika Singler is an attorney licensed in Indiana and does not seek to practice law in any jurisdiction in which they are not properly authorized to do so. The information contained in this blog is general in nature and should not be relied upon for the circumstances of any individual(s) or businesses
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