You may have heard your bankruptcy attorney mention the threat or possibility of an adversary proceeding. Essentially, an adversary proceeding is a lawsuit usually filed within your bankruptcy while your bankruptcy is active. Sometimes, a bankruptcy case can be reopened after it is closed for the purpose of filing an adversary proceeding. While adversary proceedings are rare, they do occur in some cases.

Creditors who believe that they have a strong basis for an argument that certain debts in your bankruptcy should not be discharged usually file adversary proceedings. In other words, the creditor files a new lawsuit within your bankruptcy, asking for the Judge to determine that certain (or in some cases, all) debts should not be discharged in the bankruptcy.

After the lawsuit is filed, the court holds a hearing for the creditor(s) and the debtor to make arguments as to why the debt(s) should or should not be discharged in the bankruptcy. This hearing is held in a federal courtroom in front of the bankruptcy Judge assigned to your initial bankruptcy case.

The attorney who filed your bankruptcy petition may or may not represent you in the adversary proceeding. You have the choice to hire the attorney who filed your petition or to find a different attorney to represent you in the adversary proceeding. Along the same lines, in most cases your initial bankruptcy attorney has the option to not represent you in the adversary proceeding. The reason for this is that the adversary proceeding is considered to be a new, separate proceeding within your initial bankruptcy case.

If the Judge determines, based on the arguments presented, that the debt(s) at issue should not be discharged in bankruptcy, then you will be responsible for those debts even upon the discharge of your other debts in the bankruptcy.

Your attorney will contact you if an adversary proceeding becomes a possibility in your case. You will need to assist your attorney in preparing for the defense of the adversary proceeding, because you know the facts of your case better than anyone, and the outcome of an adversary proceeding usually depends on the specific facts of the case.