How Bankruptcy Affects Other Legal Issues

There are cases where financial concerns are just a portion of the legal troubles or issues a client is facing. In those cases, it is especially important to seek the guidance of legal counsel who can examine a client’s situation and determine how different legal proceedings will affect one another. Depending on the circumstances, being involved in another legal proceeding may have a significant effect on that client’s bankruptcy petition.

Cases Besides Bankruptcy
The following types of cases are common ones that a bankruptcy client may be involved in while also filing a bankruptcy petition.

Domestic Relations – It is important to notify clients who may be involved in a divorce or custody proceeding that certain debts related to these types of cases cannot be included in their bankruptcy petition. Child support, alimony payments, and any other obligations that are ordered as part of a divorce or separation agreement are all considered non-dischargeable.

Employment – If a client has a claim against his or her employer, it must be listed on their bankruptcy petition before they file. Otherwise, the employee client may be prevented from litigating their claim once the bankruptcy case is closed, or may be forced to turn over the claim to the bankruptcy trustee, who may settle the case for less than it is worth.

Suits Involving Lenders or Contractors – A client with an affirmative claim against a mortgage holder or contractor must list the claim within his or her bankruptcy petition. Otherwise, they may be prevented from bringing the claim after the bankruptcy petition is filed, much like with an employment claim as described above.

Of course, there are many other cases where a pending or soon-to-be filed bankruptcy petition may be affected, or may affect the client’s rights as to his or her other case. These scenarios are more common and present ordinary issues that bankruptcy attorneys are prepared to address. Issues such as these are important reminders that while the bankruptcy process may seem straightforward, in many cases, it is not. It takes an experienced professional to ensure the bankruptcy process runs smoothly and effectively in order to get a positive result for the petitioner.

Contact a Bankruptcy Attorney
Of course, being involved in another legal proceeding is not the only reason that hiring a bankruptcy attorney in Memphis, TN to handle your case is beneficial to you. The bankruptcy process can quickly become overwhelming and confusing for those not familiar with it, no matter how simple you think your case may be. Contact a law firm today.

Thanks to Darrell Castle & Associates for their insight into bankruptcy law and how bankruptcy can affect other legal issues.