Discharge Was A Clerical Error?

[Charis]

I filed Chapter 7 last September. My Attorney and the Trustee have gone back and forth on a couple of issues regarding money in my Son's Savings Account. We provided all necessary documents and that issue was settled. I then receive a copy of my Discharge Order dated January 19th. The Order says "DISCHARGE OF DEBTOR(S) WITH ORDER APPROVING TRUSTEE'S REPORT OF NO DISTRIBUTION, CLOSING ESTATE AND DISCHARGING TRUSTEE"

Shortly thereafter, on February 3rd, I received a letter from the Trustee's Paralegal addressing a $10,000 non-exempt deduction from my residence. I call my Attorney's office and they said it appears my case discharge was a clerical error. My Attorney said the Trustee will likely petition to reopen my case.

I am so frustrated and wondered if this is a common occurrence. According to my Attorney's office, all I can do is wait and see, which is so stressful to me.

I'd appreciate your thoughts on this matter.

[newbie2]

This is pretty rare (for the discharge to happen and have the case re-opened). Unfortunately your attorney is correct, all you can do now is wait for the Trustee to make a move and then have your attorney address it. Good luck to you and please let us know what happens.

[justbroke]

I don't think that your discharge is being vacated... it's just that your case is being re-opened. Your actual discharge, what all of us really want (but don't know we want it the most), is likely not to be touched at all.

So this is a clerical error on "closing" the case... not discharging the case. They are two different things. What's they'll do is, worse case, is vacate the discharge order and create a new discharge order with the same effective date. They will also keep the case open while the, now, "asset" case is administered.

[AngelinaCatHub]

That's a pretty mean trick. It is possible to reopen a bk if Fraud is suspected. If the 10k was previous settled, what grounds does this Trustee have?

If he attempts to reopen, you can have your lawyer enter an objection to a previously closed case. It is inhibiting your "new start" that the Congress has made possible. (a good argument).

'Hub

[justbroke]

I don't think this reads as through it was for Fraud. For fraud, a case can always be re-opened. This reads as though the case should have discharged normally, but should have been still open as an asset case. What happened was that the Trustee probably erred and forgot to change the Asset Case flag from "N" to "Y". This caused an autodischarge and autoclose. They are trying to fix the auto close.

Unfortunately, the Order discharging the case must also be fixed since it was an Order discharging the debtor and the Trustee. The Trustee still has work to do.

'Hub, even if you could challenge this, the Code allows a Trustee to re-open an estate if there were assets that should have been administered, but weren't found until later. There could be an argument that the Trustee was aware because the aqsset was scheduled. That the Trustee made a mistake, is not something that rises to the level, allowing the case to be re-opened. The Trustee would have re-opened the case within 14 days of the Order closing the case.

Upon further reflection, looks like the Trustee did meet the 14-day window to have an Order vacated.

[Charis]

Thanks and more information on my case... Thank you so much for your responses. Here is more information on my case that I received when I called the toll free number:

Filed: 09/2010
Meeting of Creditors: 11/2010
No Assets Reported
Case Discharged: 01/2011
Case Status: Unknown..don't know if case was closed and thanks to this site, realize closing and discharge are two different issues.

Let me clarify that there was NO FRAUD in my case. During the Meeting of Creditors, I found out my name was on the the marital residence. How could I not know before filing and court, right? Well, I thought my name was on a Quit Claim Deed/Joint Tenants With Right of Survivorship. I didn't know that put my name on the property at the time of closing. Anyway, in Court, the Trustee informed my Attorney to Amend the Petition to include the marital residence on the asset list and my attorney did so.

The next contact we had with the Trustee was a letter requesting documents on my minor child's savings account. Those statements were provided in a timely matter. The first letter from the Trustee never mentioned the mortgage equity. Then the case was discharged without any mention of the marital property equity.

I honestly believe the Trustee failed to follow up on the equity in the marital home after the amendment to add it to my Chapter 7. I think the Trustee overlooked the Amendment and it was an oversight on his part. Again, this is what the Discharged stated, "DISCHARGE OF DEBTOR(S) WITH ORDER APPROVING TRUSTEE'S REPORT OF NO DISTRIBUTION, CLOSING ESTATE AND DISCHARGING TRUSTEE".

It is frustrating that the Trustee could make an error and then "oops" re-open the case. I am so ready for this to be over and from what I read on this site, the actual closing can drag on for some time.