Bankruptcy, then divorce, and then contempt?????

[rdrunner29]

I filed for a Chapter 7 at the end of 2009, and due to inclement weather in the area, I did not have the 341 meeting until later, and it was successfully discharged in March of 2010.
I also was in the process of divorce and had run out of funds to pay a divorce attorney so I was pro se, and the divorce was taking place in another state, and I had already used all of my vacation time by the time the hearing rolled around in November of 2010.
Long story short, my ex-wife drove out of state with the vehicle which the payments had been discharged in the Chapter 7 bankruptcy.
Well, due to me not having an attorney and being pro se from Maryland, her attorney would not even tell me what they were asking for. If I had known that she wanted to keep the vehicle, I would have protested then that those payments had been discharged more than a half a year before the divorce hearing, which she was well aware of the fact that I had filed for a Chapter 7.
The family court judge awarded her the vehicle and me the payments, which I am not able to make. I did ask my bankruptcy attorney, and he said he does not understand how in the world a family court is ordering not only that I pay the discharged debt but also make up all late payments! He added that no one can order me to pay debts that were discharged debts!
Now, her and her attorney are trying to hold me in contempt for not paying those payment. I have retained a family law attorney in GA, where the divorce was, and he is totally perplexed by the situation.
My thinking is that I should challenge the jurisdiction since my bankruptcy was held in the state where I am a resident, Maryland.
Please, anyone with advice or real world examples, your responses would be appreciated!

[JackBondLove]

When you had the debt discharged for the vehicle, the ownership reverted back to the creditor - at which time, the creditor basically allowed you to have a rent-to-own agreement, in which if you continue to make the payments, you get the car. The divorce decree basically requires you to continue to be in this rent-to-own until the payments are complete, with your ex-wife getting the car at the end. The two cases are not connected. If you were to plead that you are too impoverished to support making the payments, you would need to get relief at the family court - you cannot use the BK decree to get you out of your obligations (although certainly, going through a BK does seem to be good evidence that your financial situation is not the best.)

I suggest posting your situation to a divorced men group - there are a myriad of incredible stories of ex-husbands being unfairly treated, and perhaps someone has gone through this and was able to get relief.

[malf1204]

I would disagree there is no legal ride-through in the BK code anymore. You either reaffirm or surrender. The bk is discharged and he cannot reopen and reaffirm so his only option is to surrender. The state court judge is trumped by Federal BK law. He can order some other form of support but I would think that ordering him to pay a discharged debt is a violation of the permanent injunction. There was a similar case where a contractor had a business debt discharged and the merchant filed criminal charges against the contractor for theft of service and the prosecutor and judge allowed the contractor to avoid prosecution if he paid the debt. The contractor did and the case was dismissed. He then filed a complaint with the BK court and the BK Court ruled that the merchant and the prosecutor and State Court judge had violated the permanent injunction by forcing the debtor to pay a discharged debt. The judge said you cannot do and end run around the injunction after the fact.

[despritfreya]

rdrunner,

You do have a real problem. While the obligation to the lien holder has been discharged, your obligation to your ex has not. In fact, it apparently did not arise until sometime after you filed your bk. Since she was given possession of the vehicle and you were saddled with the payment, this obligation to your ex appears to be "in the nature of support".

Obligations that arise out of a divorce degree are not dischargeable in the context of a Chapter 7 therefore, whether the Order directing you to make the payments was entered before or after you filed bk, you are, IMHO, stuck with it. While the lien holder cannot demand payment your ex can demand that you service the vehicle loan. If you don't you may be subject to contempt proceedings in the DR court.

As to your bk attny not understanding, I am a bit perplexed. Surely he knows about 11 USC 523(a)(5) and (a)(15) and its effect on a pre petition DR decree. Surely he understands that a Court Order in a DR matter that "is in the nature of support" and is entered after the bk was filed is a post petition obligation between the ex spouses and is not subject to either 11 USC 362(a) or 11 USC 524. In fact, 11 USC 362(b)(2) specifically authorizes the post petition establishment of support. Please go back to him and ask that he explain these code provisions to you. I don’t mean to be flippant but this is “bk 101” in my book.

Des.

[malf1204]

The BK was discharged in Mar 2010 and the hearing on the vehicle was not until Nov 2010 if I am reading it correctly. The car was discharged prior to being awarded to the ex. If the car was awarded prior to discharge then yes it would be "in the nature of support" but it was discharged then awarded. I think the State court judge is violating the permanent injunction. I would not make any payments let the car be taken back by the lender and reopen my BK case and file a request to show cause against the state court which should halt all state court proceedings. Correct me if I am wrong.

[despritfreya]

The BK was discharged in Mar 2010 and the hearing on the vehicle was not until Nov 2010 if I am reading it correctly. The car was discharged prior to being awarded to the ex.

I think you are missing my point. OP has been ordered to pay for the ex's car. This is not an Order that he pay a particular creditor. It is an Order that he compensate (support) his ex. It just happens that supporting his ex, in this instance, means paying a debt that was discharged.

If OP wants to argue the point, I as the Judge would say, "Fine, then you OP pay your ex the equivalent amount each month and ex you pay the lien holder. And, by the way, OP, the alimony I previously awarded that you seem to think you do not have to pay will end when the lien on the vehicle is released." The problem with this approach is that OP no longer has control and may have a tough time verifying that the ex used the $$ he paid to pay off the lien.

Just my take on this.

Des.

[rdrunner29]

From my understanding, and the reason why the BK attorney was confused as to how they are ordering payment of this debt, is that according to the BK court, my credit report, etc., this debt no longer exists to be awarded to one party or the other.
When she asked her lawyer to ask for the payments to be made, she was well aware that I had filed for BK, and that it had been discharged.
Also, as I am sure you all aware, once I began the process of filing for BK, my attorney advised me to ceases making all payments to creditors, including the vehicle payments. This occurred in September of 2009.
So, when this was ordered in November of 2010, not only did the judgment read that I was to make payments on this discharged debt, but was to also make up all back payments to the vehicle, which had not been paid on since September of 2009. Which in itself would be almost $6k, money that I did not have, which is why I filed bankruptcy to begin with, and ran out of funds to defend myself in the divorce proceedings.

[LadyInTheRed]

From my understanding, and the reason why the BK attorney was confused as to how they are ordering payment of this debt, is that according to the BK court, my credit report, etc., this debt no longer exists to be awarded to one party or the other.
When she asked her lawyer to ask for the payments to be made, she was well aware that I had filed for BK, and that it had been discharged.
Also, as I am sure you all aware, once I began the process of filing for BK, my attorney advised me to ceases making all payments to creditors, including the vehicle payments. This occurred in September of 2009.
So, when this was ordered in November of 2010, not only did the judgment read that I was to make payments on this discharged debt, but was to also make up all back payments to the vehicle, which had not been paid on since September of 2009. Which in itself would be almost $6k, money that I did not have, which is why I filed bankruptcy to begin with, and ran out of funds to defend myself in the divorce proceedings.

You still aren't understanding Des' point. The divorce court awarded the car to your ex-wife. The creditor has a lien on the car even though you have no obligation to the creditor. The divorce court ordered you to make the payments necessary to remove the lien. It's the same thing as if the court had ordered you to give your wife the car and pay her a lump sum equal to the amount of the lien so that she could pay it off. This is a non-dischargeable obligation to your ex-wife, not to the creditor. It is not the same debt as the car loan even if the method by which you are to pay the debt is by paying of the car loan. If you let the lender repossess the car like malf1204 suggests, you will be in violation of the divorce court order and would probably be ordered to pay her the value of the car. The BK discharge is not releavant. If you are not capable of meeting your obligations to your ex-wife, that is a matter for the divorce court.

[rdrunner29]

So, what you are saying, is that in reality he could have ordered me to pay all debts that were discharged just because?
Would that not make a mockery of the bankruptcy process? I mean, if you can only file once every 8 years, and a divorce court orders you to pay all debts that were discharged in the BK, then you are stuck paying those debts, even though you told the trustee that you were unable to do so which is why you filed bankruptcy in the first place. Sounds like a set-up for failure, contempt and jail time if a soon to be ex-spouse wanted to be vindictive.

[rdrunner29]

And for the record, I did not re-affirm the debt back in March of 2010, and the order from divorce court came 9 months after the bankruptcy was discharged.

[helpmeout]

Your BK attorney is not a family law attorney. Your BK attorney also should know that court ordered support is not dischargeable in a BK action. Just what does your court order for the divorce state about the payments? In my court order, all debt payment was ordered to be considered as support payments. I got all of the debt and it was all in my name, so my filing BK didn't have an impact. But if it was in my ex's name, I could have still been held responsible for the debt should the creditors go after my ex. I would then have to make payments to him.

Then there's the issue of timing. If your court order does state that it is support, then you neglected to tell the family court that the debt was discharged in a BK action before they made the order. Not only that, it's now 2012, years after the fact and you are just now addressing it.

You need an attorney in the state that the court order for the divorce is from. Clearly, going pro se really wasn't a good idea.

[malf1204]

Are you the same LadynRed who wrote this advise on another board???


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Your divorce decree has absolutely NO bearing on the bankruptcy court and once the debts are discharged, NO ONE can attempt to collect from you for them, not even the EX waving the divorce decree. Hopefully you added the EX as a creditor, if you did not, it would be a good idea to do so.

A state/county family court cannot make you pay a debt the FEDERAL BK court says you are no longer liable for. Your EX will bear the full brunt of those debts if her name was on them.

[mountanddo]

Are you the same LadynRed who wrote this advise on another board???


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Your divorce decree has absolutely NO bearing on the bankruptcy court and once the debts are discharged, NO ONE can attempt to collect from you for them, not even the EX waving the divorce decree. Hopefully you added the EX as a creditor, if you did not, it would be a good idea to do so.

A state/county family court cannot make you pay a debt the FEDERAL BK court says you are no longer liable for. Your EX will bear the full brunt of those debts if her name was on them.

I am guessing the answer is no since this advice contridicts what ladyinthered states here. It seems that your ex had possession of the car all along. What was the plan for the car after BK and why did they not reposses it before this happened?

[mountanddo]

Are you the same LadynRed who wrote this advise on another board???


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Your divorce decree has absolutely NO bearing on the bankruptcy court and once the debts are discharged, NO ONE can attempt to collect from you for them, not even the EX waving the divorce decree. Hopefully you added the EX as a creditor, if you did not, it would be a good idea to do so.

A state/county family court cannot make you pay a debt the FEDERAL BK court says you are no longer liable for. Your EX will bear the full brunt of those debts if her name was on them.

Also, I hope no one is copying and reposting my posts from here on another board. If I want my posts on another board I'll post them there. I'm pretty sure this "LadynRed" might feel the same way!

[malf1204]

If he did not reaffirm and the car was discharged it is legally not his anymore correct? That now belongs to the lien holder. How can the judge award a car that is not his to his ex. As he keeps pointing out the bk was discharged long before the car was ordered to his ex.