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A Bankruptcy Filing During Divorce
December 12th, 2009 by admin
During a Bankruptcy filing, divorce attorneys like to insert language in the divorce agreements or decrees reciting that certain obligations are not dischargeable in a subsequent bankruptcy case by one of the ex-spouses. Now there may be differing opinions on what parts of a divorce decree are or are not dischargeable in a bankruptcy, but such language does not mean that the automatic stay of a bankruptcy filing does not apply. A bankruptcy filing will stop actions to enforce collectibility of a divorce decree. Recently, there was a case where a divorce attorney threatened an ex-spouse with “arrest” if she did not show at a contempt hearing even after being warned of the filing of a bankruptcy case more than three times. The attorney did not believe that there was anything wrong with that action because the divorce agreement provided that the underlying debt to an ex-mother-in-law would be non-dischargeable in a bankruptcy case. In an affront to the U.S. Bankruptcy Court, the attorney insisted on going forward with the divorce court hearing up until the last minute.