The Trustee's Motion to Dismiss

When someone files for bankruptcy, their case is assigned to an interim trustee who handles the administering of the case from the onset to discharge. In Chapter 7 cases, this is usually a short period of time, unless the case is determined at the 341 hearing to have assets that can be distributed to creditors. In Chapter 13, however, the trustee works on the case for three to five years and has a much more detailed hand in how the case will play out. This includes filing certain motions to dismiss the case if required under the Bankruptcy Code.

Motions to dismiss the case can be an alarming event in a debtor's case. Most of the time they are for a failure to make the plan payment to the trustee for enough times to trigger the motion. Sometimes these motions can also be for failure to turnover certain documents (like tax returns) or complete certain requirements of the case. In the event that you receive one of these motions to dismiss, consult your bankruptcy attorney right away.

With the motion to dismiss for failure to make plan payments, there are a couple options. First, the debtor can cure the default. This involves determining how much is delinquent that led to the motion to dismiss in the first place. This money can be sent off like a regular trustee payment, or, if there is little time until the motion is scheduled to be heard, can be tendered by the debtor's attorney in open court to the trustee or their representative. Second, the debtor's attorney can file a motion to modify the plan and defer the default, if that is possible. This involves spreading out the default through the rest of the plan and as a result raising the trustee payment. Finally, and this isn't the best solution, the debtor can allow their case to be dismissed as a last resort and refile their Chapter 13 bankruptcy after a sufficient amount of time has passed.

Obviously, these are highly complicated events and maneuvers. Dismissal of a bankruptcy is a serious matter no wonder what precipitated it. Consulting your experienced bankruptcy attorney is the best starting point for a solution regardless of the situation.

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