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Adversary Proceeding- A litigated controversy or lawsuit in the bankruptcy case. It can be commenced by either the debtor or the creditor with the filing of a Summons and Complaint and requires the filing of a written Answer setting forth all defenses. An objection to discharge by a creditor is the most common adversary proceeding you are likely to see. See Fed. R. Bankr. Pro. 7001-13. Automatic Stay- A stay of all collection activities against the debtor and their property (and co debtors in a Chapter 13 proceeding), is automatically triggered upon the filing of a bankruptcy petition. It prevents creditors from commencing or continuing collection activities, enforcing judgments, obtaining possession of property, creating, perfecting, or enforcing liens, or setting off a debt. BAPCPA limits the application of the automatic stay or provides that it does not go into effect in certain situations. See I 1 U.S.C. §362. BAPCPA - The new bankruptcy law, entitled the "Bankruptcy Abuse Prevention and Consumer Protection Act of 2005", went into effect on October 17, 2005. This law substantially changed the requirements for eligibility for Chapter 7 relief, the filing requirements and the extent of the discharge issued in such a case. Bankrupt- A debtor who has received a bankruptcy discharge. Bankruptcy (Consumer)- A legal proceeding brought by an individual debtor (voluntary) in Bankruptcy Court. Its purpose is to give debtors a "fresh start" by discharging or canceling their debts and to provide equity to their creditors by fairly distributing the debtor's nonexempt assets among them. Bankruptcy is governed by the United States Bankruptcy Code (11 U.S.C.) and the Federal Rules of Bankruptcy Procedure (Fed. R. Bankr. Pro.). Chapter 7- The most common type of a consumer bankruptcy case. It is a case brought in, and supervised by, the United States Bankruptcy Court, in which a case Trustee is appointed by the United States Trustee to determine if the debtor meets the eligibility for Chapter 7 relief and to collect the assets of the eligible debtor that are not claimed or determined to be exempt property. These assets are liquidated to cash in order to make payments to creditors. If there is little or no property not claimed as exempt, then there is no property to liquidate and there will be no distribution to any creditors. This is known as a "no asset" case. At the conclusion of the case the debtor receives a Discharge of those debts that are legally dischargeable. See 11 U.S.C. §7. |
Bankruptcy Glossary of Terms
Part 1 of 9