When does a motion to dismiss bankruptcy occur? And when does a bankruptcy denial of discharge occur in New York?
Most consumer bankruptcy cases in New York do not involve a motion to dismiss the bankruptcy case. And most consumer bankruptcy cases in New York do not involve a bankruptcy denial of discharge either.
That said, it is still good to understand when they do occur and why.
A motion to dismiss bankruptcy can occur when there is a belief that a debtor’s bankruptcy filing is abusive. Abusive could mean that the debtor does have enough income to file Chapter 13 rather than Chapter 7. It could also mean that the debtor engaged in fraud or other activities that run counter to the purpose of the bankruptcy laws.
However, such motion to dismiss a bankruptcy case on the basis of abusive filing can only be made by the U.S. Trustee’s office or by the bankruptcy court itself. A Chapter 7 trustee (who, for the record, is different from the U.S. Trustee’s office) can send a Chapter 7 case to the U.S. Trustee’s office for review for abuse. But it is the U.S. Trustee’s office in such cases that makes the decision to make a motion to dismiss the bankruptcy case.
A bankruptcy denial of discharge, in contrast to a motion to dismiss, occurs as a result of a creditor’s action or a Chapter 7 trustee’s action. If one of them claims, and is able to prove, things such as:
1. That the debtor transferred, concealed or destroyed property in the one-year period prior to filing for bankruptcy or in the one-year period following a bankruptcy filing, and that such action was undertaken with intent to hinder, delay or defraud.
or
2. That the debtor concealed or destroyed assets and then failed to keep accurate records or falsified such records.
or
3. The debtor made false statements or presented false information in connection with its bankruptcy case.
Granted, if a creditor has an objection to a debtor’s discharge, it is more likely to be in connection with a specific debt rather than the full discharge. Whereas a Chapter 7 trustee’s objection to discharge would be for the entire case. It’s worth noting that cases can be dismissed for failure to provide pay stubs or tax returns or to do the pre-petition credit counseling. Failure to attend the creditors’ meeting is yet another possible reason for dismissal.
For these reasons, it is vitally important to provide thorough, accurate and honest information when working with bankruptcy attorneys in Brooklyn or anywhere else in New York. Otherwise you risk jeopardizing your entire case.
For more questions on the topics of motion to dismiss bankruptcy and bankruptcy denial, please feel free to contact experienced New York bankruptcy attorney near me Bruce Weiner for a free initial consultation.
