There are a number of reasons for opening a closed bankruptcy case.
After a discharge, a creditor is not permitted to attempt to collect a debt from the debtor. Any attempt of a creditor to collect a debt after discharge is a violation of the injunction provision of the bankruptcy code. A debtor may wish to open a bankruptcy case and file an Adversary Complaint against the creditor for such a violation, in addition to a request for sanctions. A creditor’s attempt to pursue the collection of a discharged debt is typically, a violation of the Fair Debt Collection Practices Act. The complaint may include an additional count for such a violation.
After a discharge, the debtor may wish to open a bankruptcy case for the purpose of requesting additional relief that was not requested while the case was open. An example would be to open a case to request an order to avoid or eliminate a lien on property. In certain situations, the dischargeability of certain debt is not clear, such as an income tax liability for a specific year. An individual may wish to open the case and file the appropriate documents, requesting an order reflecting that certain tax debt is dischargeable.
A bankruptcy case may be opened to include a creditor and provide them with the proper notice. A trustee may wish to open a case to revoke the discharge in the event of a debtor’s fraud. Also, a creditor that was not notified of the bankruptcy case, may wish to open a case to request an order reflecting the nondischargeability of the debt due to the creditor.
There is no specific limit as to the number of times a case may be opened. A case may be opened a number of times in the event that creditors repeatedly violate the injunction provision.
Robert Manchel is a bankruptcy attorney in New Jersey that is available to answer your questions regarding bankruptcy protection at (866) 503-5655.