My Bankruptcy was discharged on August 17 2011. On August 19 2011 a lawsuit was filed against me on a debt that was discharged. I was being sued before the bankruptcy on a carry back loan held by the construction company who I bought my house from. Now a year and a half later I get a notice that the bankruptcy court wants me to go to a hearing on an 'Order to show cause why the proceeding should not be dismissed'. Meaning they filed the lawsuit after my discharge and have done nothing since, including not even serving me. In fact this is the first time I knew I had a lawsuit filed against me. They are supposed to file a response by a certain day or the case will be dismissed. My question is this: Why won't the judge just dismiss the case (the lawsuit they filed August 19 now claims fraud which is absolute frivolous bullshit) and if they answer and I pay my attorney the $200.00 he wants, can I get my attorneys fees back from them? It seems they had all kinds of time (60 days) and now they allege fraud which is stepping up their game a little from the previous lawsuit...why is this allowed?
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While it would be within the Judge’s discretion to dismiss the adversary due to lack of prosecution, most will not without giving the Plaintiff the opportunity to be heard. Something called due process.
The OSC is directed at the creditor and is normal procedure depending upon local practice. Why it took so long for the OSC to be issued is anyone's guess. In my jurisdiction (assuming the file does not fall through the cracks - which is probably what happened in your case), the Judge issues an Order that if the Plaintiff fails to request a status hearing within 30 days the case will be dismissed. This Order is typically sent out if there is no activity in the adversary over 6 months.
As to recovering legal fees - probably not.
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