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Objections To Discharge
LAWDOG is intended to assist in the understanding of basic concepts. See Disclaimer. Always obtain legal advice from legal professionals.
In a Chapter 12 case, certain debts of an individual debtor are "non-dischargeable" under Section 523 of the Bankruptcy Code. Section 523 provides that a discharge generally does not discharge certain taxes or customs duties, certain spousal or child support obligations, or fines, penalties, or forfeitures to a governmental unit. In addition, certain student loans, death or personal injury caused by the debtor while intoxicated, and a debt to which the debtor waived, or was denied, a discharge in a prior case may be "non-dischargeable".
Certain other types of claims may be found, by the court, to be nondischargeable under Section 523. Provided that the debtor has properly scheduled the debt and provided notice of the Bankruptcy, these types of claims are discharged unless the claimant timely files a proof of claim, and timely files a complaint for a determination of dischargeability of such debt. Debts that are for fraud while the debtor was acting as a fiduciary, embezzelment, or larceny are listed in this category. Also included are willful and malicious injuries and certain property damage caused by the debtor.
Also included is Section 523 (a) (2) which provides that a claim may be found, by the court, to be nondischargeable by an individual debtor, for any debt for money, property, services, or an extension, renewal, or refinancing of credit, to the extent obtained by use of a materially false written financial statement respecting debtor or an insider, on which the creditor reasonably relied, and that the debtor caused to be made with intent to deceive. See Exceptions To Discharge linked here. Link does not return to this page.
A debtor or any creditor may file a complaint to determine the dischargeability of any debt pursuant to Section 523(c) of the Code not later than 60 days following the first date set for the meeting of creditors held pursuant to Section 341(a). The court shall give all creditors not less than 30 days notice of the time so fixed in the manner provided in Rule 2002. On motion of any party in interest, after hearing on notice, the court may for cause extend the time fixed under this subdivision. The motion shall be made before the time has expired. See Bankruptcy Rules Rule 4007 reproduced here for illustration purposes only.
A creditor with an issue of the dischargeability of a debt in an actual case should consult legal counsel immediately upon receiving information of the filing of a bankruptcy. Appropriate motion or complaint must be filed within the strict time limits or the right to do so may be barred.
