CHAPTER 2 THRESHOLD ISSUES TO FILING

• Jurisdiction: United States

CHAPTER 2 - THRESHOLD ISSUES TO FILING

Every prudent bankruptcy attorney knows that diligent pre-petition investigation and planning is essential to a successful case and a happy client. Consumer debtors are rarely aware of the potentially disastrous outcomes that can occur in a bankruptcy. Chapter 2 discussed several threshold issues to filing, including failing to properly disclose an asset and its value, or what happens if debtors voluntarily dismiss their case after a creditor has filed a motion for relief from the automatic stay.

Section 109(g)(2) imposes a particularly harsh penalty of a 180-day bar to filing if a debtor voluntarily dismisses his case after a creditor files motion for relief from the automatic stay. There are two schools of thought on how to interpret §109(g)(2). First, a strict, sequential interpretation requires the 180-day bar every time a case is voluntarily dismissed after a motion for relief was filed. Second, a more moderate interpretation calls for a causal connection between the motion for relief and the dismissal that followed. When a...