How to file bankruptcy (#4 of a series)

06 Mar How to file bankruptcy (#4 of a series)

Now that we’ve gotten almost through the first two pages of our bankruptcy petition, we’re ready to figure out the court where you will file your bankruptcy petition.

You’d think this would be a piece of cake too. For people who don’t move around too much, this is not too much of a problem. But laws can be very different from place to place. For example, if you live in New York, have your business in New Jersey and have property in Connecticut, you could file your bankruptcy case in any of these places. That’s pretty hard to fathom. All you have to do is check a box:

Here’s the first choice:

Debtor has been domiciled or has had a residence, principal place of business, or principal assets in this District for 180 days immediatelypreceding the date of this petition or for a longer part of such 180 days than in any other District.

Notice that the decision can be based on you residence, principal place of business or principal assets. For many people, this offers many choices. Notice too that if you’ve been moving around, these features are measured by your situation over the past 180 days.

And if you have a family member, a partner or an affiliate which already filed a case, then you could choose to have your case go ahead in that district:

There is a bankruptcy case concerning debtor’s affiliate, general partner, or partnership pending in this District.

A person could even file a bankruptcy in the US if he are being sued in the US, even if he:

has no principal place of business or assets in the United States but is a defendant in an action or proceeding [in a federal or state court] inthis District, or the interests of the parties will be served in regard to the relief sought in this District.

You have choices and options. How will you choose? Did you know that even though the bankruptcy law is the same throughout the US, it might be interpreted differently in different regions? Did you know that different courts have different procedures? Judges vary a lot from place to place too.

All you have to do is check a box to select your venue. Will you choose wisely? Maybe you’ll want a lawyer to help you figure it out.

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Jay S. Fleischman is a bankruptcy lawyer with offices in Los Angeles and New York. He can often be found on Google+ and Twitter, where he shares information about consumer protection issues and personal finance.
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