Expert: Terry Leeders - 4/8/2009

Question
QUESTION: Hello. my husband and I received our discharge under section 727 title 11.  On the back page it stated that this is a discharge but not a dismissal....What does this mean?  Also on the back page it states that the discharge prohibits any attempt to collect debt and to file or continue with a law suit.....My question here is that Chase bank has a adversary motion against me for misuse of a credit card during the 90 day prior to filing....Does the adversary motion get thrown out due to the discharge or do I continue to fight it? Thank You

ANSWER: discharge is good. Dismissal is bad (meaning the court denied your case and you still owe the debt)
The adversary is the exception to discharge. Whatever the outcome of the adversary was (say you agreed to pay a certain amount back) would survive the discharge and they can collect on that outcome.  If the court ruled in your favor, then the debt is discharged. So, it sounds like you need to continue to fight it.

---------- FOLLOW-UP ----------

QUESTION: Hello. just wanted to clarify a few points....The adversary hearing is still going on we have not been to court yet...so do i still still need to continue since their was no ruling even though my case is discharged?  Also the reason it is not dismissed (closed) is because I told the trustee that their is an inheritance coming so that is what the court is waiting for, to see how much and what to distribute to the creditors....I just found out from the trustee that my lawyer did not file for the exemptions on the inheritance and they told me that the entire inheritance would be disbursed.....Do I need to reopen and file new motion with the exemptions so I can Atlas get money I am aloud to keep under the bankruptcy statue?  Thanks

Answer
You still need to address the adversary. The case discharges automatically, with the exception of any adversary proceedings.  The case can stay open past discharge to liquidate any assets.  No need to reopen, since the case sounds like it still is open.  You can try to file an amended exemption list if there are exemptions to use in your jurisdiction.  You need to send them to the trustee, US trustee as well.  If there is an objection to the exemptions, then you need to present your case in court to the judge to decide if they will be allowed.