The bankruptcy attorneys call this the “automatic stay” because as soon as the bankruptcy is filed, any other matter affecting finances is “stayed” or temporarily stopped until the bankruptcy is over or the bankruptcy court gives its blessings. The effect in our case was that we immediately stopped the negotiations. The proper action then is for the bankrupt party to seek to “lift the stay” so that the family law case can go forward. This is relatively easy to do, but it must be done.

If you are in ANY kind of lawsuit, you must tell your divorce attorney immediately if you are in or contemplating bankruptcy. You should do this anyway since bankruptcy can affect

many parts of the divorce decree or other family law order, In our case, the other party is going to seek to lift the stay and proceed with the case. While it may not be a big problem, it will result in both parties having to be in a family law case far longer than otherwise necessary. If the other party had told her attorney that she was in bankruptcy, the stay could have been lifted long ago and the case might be over now.

The ironic thing was than my client did not even know about the bankruptcy. He

went into the settlement in good faith expecting a resolution and is now

simply waiting to get back into the game.

Bankruptcy-divorce? If you have filed a bankruptcy and also need a divorce, contact Bob Leonard Law Group, PLLC, in Fort Worth, TX, 817-336-8500. Bob Leonard is Board Certified In Family Law and has 30+ years experience as an attorney. We can take the right steps in the right order to save you time and money.

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