Divorce court has no jurisdiction over bankruptcy

California residents who are facing both a divorce and bankruptcy may be interested to learn that a federal bankruptcy judge recently determined that bankruptcy could potentially wipe out divorce settlement obligations. The case was taken to federal court after a Georgia judge determined that the state court did not have jurisdiction to determine the effect of the bankruptcy on a divorce settlement.

About two weeks after a Georgia couple finalized their separation, the ex-husband filed for Chapter 13 bankruptcy. Under Chapter 13 bankruptcy, an individual can seek debt relief while maintaining their property. However, they would have to come up with a plan that requires any future income to be used to pay a portion or all of the debt that they owed over a period of up to five years. In their divorce decree, the ex-husband had agreed to pay a lump sum and a certain amount in child support to his ex-wife.

The ex-wife sued for a declaration that the lump sum owed to her would not be discharged under the ex-husband's bankruptcy case. However, the federal court ultimately determined that the lump sum owed could potentially be discharged when the ex-husband was finished drafting up the bankruptcy payment plan.

Dividing marital property up between two former spouses can be difficult, especially if the former couple has been married for many years or has obtained numerous marital assets. If the two cannot agree on how to divide up the assets, a family law attorney may help in the negotiation process. If the other party attempts to avoid paying what was agreed upon in the divorce settlement either by filing for bankruptcy or by simply refusing to transfer the assets, the attorney may determine a legal response.

No Comments

Leave a comment
Comment Information

Gavin & Dersch Law and Mediation

Vista Office
630 Alta Vista Drive, Suite 210
Vista, CA 92084

Phone: 760-691-1763
Fax: 760-941-4425
Vista Law Office Map

Del Mar Office
12636 High Bluff Drive, Suite 400
San Diego, CA 92130

Phone: 760-691-1763
Fax: 760-941-4425
Map & Directions

Schedule Consultation

Contact our attorneys today

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

  • 10 BEST 2016 | CLIENT SATISFACTION |American Institute of Family Law Attorneys
  • State Bar of California | California Board Of Legal Specialization

    Attorneys Paul Gavin and Wayne Dersch are certified as a family law specialists. Learn More