California Bankruptcy Lawyers - "What happens if creditors try to collect while bankruptcy is pending?"

If creditors or their bankruptcy lawyers attempt collection any debt while a California case is pending, court sanctions may be ordered by the judge. Creditors and their bankruptcy lawyers are allowed to collect only specific debts and take specific actions which are authorized by the court. 11 U.S.C. 362 sets forth exceptions to the automatic stay which limits creditors and their bankruptcy lawyers. If a creditor desires to proceed with collection efforts, a motion must be filed seeking permission. Creditors and  their bankruptcy lawyers who fail to obtain court permission are subject to sanctions. If an attempt to collect a discharged debt is instigated after a debt is discharged and the case is closed, the procedure is similar. The debtor or  their bankruptcy lawyer may ask the court to reopen the case and impose sanctions upon the offending parties, their bankruptcy lawyers, or both. Available sanctions include a finding of contempt of court, specific injunctive relief, and the imposition of fines and incarceration. The most common sanction is the imposition of a civil fine.

California Bankruptcy Lawyer & Law Firm Practices - Liability

The code also specifically prohibits employers to discriminate against employees because of bankruptcy. To become actionable, the employee's bankruptcy proceeding must be the sole basis for discrimination. In practice, employers and their bankruptcy lawyers are well versed on discrimination law concerning "plausible deniability." Any other basis, such as those commonly documented by memorandum warning of poor job performance, often relieve employers from liability. For employees, the bankruptcy discrimination statute is grossly ineffective.

All prudent debtors have questions about applicable laws before filing. The best source of legal advice is a qualified bankruptcy lawyer with substantial, current experience practicing before federal courts. Because state and federal laws change frequently, the results achieved by bankruptcy lawyers for their clients also change frequently  in direct response to these amendments. Depending upon the personal goals and situation of each debtor, all options may not apply. The best bankruptcy lawyers are intimately familiar with all options, as an assortment of tools, that may be combined creatively to maximize client benefits.

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