BANKRUPTCY COURT
FROM THE BENCH
BANKRUPTCY COURT
By Wendy L. Hagenau Judge, United States Bankruptcy Court Northern District of Georgia
Many of you have not been to and may hope to never practice before the United States Bankruptcy Court. Nevertheless, bankruptcy touches all areas of law, and the bankruptcy court is the federal court with which most people come into contact. The bankruptcy court construes state law and proceedings regularly, so even state litigators may need a primer on the bankruptcy court.
The bankruptcy court is an Article I court created by Congress to fulfill the mandate in Article I, Section 8 of the United States Constitution to establish“ uniform laws on the subject of bankruptcies throughout the United States.” Bankruptcy judges are appointed for 14-year terms by the Court of Appeals and preside over bankruptcy cases and virtually all matters arising in those cases, including deciding issues arising under the Bankruptcy Code or which are otherwise related to the bankruptcy case. In the Northern District of Georgia, the majority of the bankruptcy cases are filed by individuals. These filings may be in Chapter 7( liquidation), Chapter 13( consumer reorganization), or Chapter 11( reorganization for debtors with higher debt levels). These cases present many different issues. While the bankruptcy judge obviously applies bankruptcy law, the rights of the parties in property and creditors’ claims are determined by nonbankruptcy law – most often state law such as contract and real estate law. Many times, bankruptcy judges must construe the effect of a state court judgment or order. Domestic relations issues also frequently arise because one of the primary causes of bankruptcy is divorce. The bankruptcy court may allow some state court litigation to proceed, in whole or in part, but may decide the state law issues itself. Bankruptcy judges publish many opinions on state law.
These are similar, but not identical, to the Federal Rules of Civil Procedure – and differ particularly in the area of service of process( both in method and scope) and various time limits. There are local rules related to the Federal Rules of Bankruptcy Procedure, which should be consulted as well. Second, many of the Federal Rules of Bankruptcy Procedure apply in“ contested matters” which are opposed motions, and not just in adversary proceedings. Third, bankruptcy courts hold hearings on almost everything and each judge holds regular“ mass” calendars to hear matters taking only 15-20 minutes. You should check each judge’ s web page for the calendaring procedures. Fourth, bankruptcy courts are courts of limited jurisdiction. They do not grant divorces or establish property division. They do not probate a debtor’ s will. They are limited in their ability to enter final judgments against non-debtors and non-creditors.
Considering these unique procedures, and the breadth of substantive law at issue, the quality of the lawyers who practice regularly before the court has impressed me. These practitioners must know substantive and procedural bankruptcy law, plus state law, tax law and many federal laws enacted to protect consumers( most of which are acronyms like FDCPA, TILA and RESPA). We are very fortunate to have these attorneys and, if you have occasion to be in bankruptcy court, consider consulting with a bankruptcy practitioner for any nuances. You may also contact the courtroom deputies for each judge with any procedural questions. We welcome state court practitioners to the bankruptcy court. ■
If you find yourself in the bankruptcy court, it will be helpful for you to note several procedural items. First, the bankruptcy courts follow the Federal Rules of Bankruptcy Procedure.
14 May 2016