Bankruptcy is a federal legal process presided over by specific bankruptcy judges. The judges have the power to deny bankruptcies, approve payment plans, deny creditors the right to sue, and much more. So why should someone filing bankruptcy have this knowledge? Because every person who files personal bankruptcy is required to be present at a bankruptcy hearing and speak to a bankruptcy judge.
The bankruptcy hearing is officially known as the “meeting of creditors,” but is sometimes referred to as the “341 hearing” because of the specific bankruptcy code that requires it. The hearing can last anywhere from 8-30 minutes depending on the complexity of the case and the questions that the bankruptcy judge chooses to ask. In most cases the questions directed at the debtor are simple ones: “how many vehicles do you own.” “how much do you owe on your mortgage,” and “have you ever filed bankruptcy before” are not uncommon. The hearing is primarily for the bankruptcy judge to determine whether he/she feels that the debtor has committed fraud. It is typical for bankruptcy attorneys to attend these hearings with their clients, and if not, to make sure that they are prepared.
During the hearing, as well as in all correspondence, it is imperative that the debtor show respect for the bankruptcy judge. Unfortunately, not every debtor is aware of that very important piece of advice. In a case being heard by a bankruptcy judge in St. Louis, MO the owner of a company currently in bankruptcy filed documents with the court making various personally-insulting comments aimed at the judge (referring to her as a “black-robed bigot” among other things). The bankruptcy judge ordered the company owner to come to court and explain herself or risk fines of $1,000 per allegation. Instead of appearing in court, she filed paperwork apparently reiterating the accusations which led to the judge fining her $500 per comment. On July 19, 2013 the federal court of appeals in St. Louis concluded that a federal bankruptcy judge has the “inherent power to protect the judicial system and the court’s own dignity by issuing fines for contempt of court.”
So, what’s the lesson here? First, leave your personal issues at the door and avoid personally attack judges for doing their jobs. Second, despite being well provoked to issue serious punishment, most judges do keep their cool and do their job with an even temper. The bottom line is that bankruptcy judges want the legal process to do what it is meant to do: help Americans get out of debt so that they can jumpstart their financial future. Speak with a bankruptcy attorney in your area today to learn more about which Chapter of personal bankruptcy may be right for you.