A bankruptcy petition can be dismissed with prejudice. Often bad faith filing is the reason for a bankruptcy case to be dismissed with prejudice.
Dismissals in General
In general dismissals are ordered without prejudice to carry on the remedial purpose of the Bankruptcy Code and to restore property rights, insofar as is practical, to the same position as when the case was first filed, without affecting the disposition of debts. Ordinarily, dischargeable debts that were not discharged in the dismissed petition can be discharged in a later case. However if the petition is dismissed with prejudice, the debtor is barred from discharging debts in the dismissed petition in a later bankruptcy.
Dismissal with prejudice
Dismissal With Prejudice means that the claim that is dismissed may not be brought again in any court. A dismissal with prejudice will bar further bankruptcy proceedings by the debtor and is a complete adjudication of the issues. Under Bankruptcy Code § 349(a), the court may, for cause, dismiss a case with prejudice such that a future case will not discharge any debts that were dischargeable in the earlier case. When you file for bankruptcy, you must not withhold or conceal any type of information about yourself, especially information regarding your finances and assets. Your petition can be dismissed with prejudice if you provide incorrect information or conceal information about your finances and assets. A Chapter 7 case can be dismissed with prejudice if the trustee determines that the debtor has the ability to repay at least part of the debt. Submitting a Chapter 13 plan without the ability or intention of following the plan can result in dismissal with prejudice. A case can also be dismissed with prejudice when the court feels that the proceedings have been filed merely to prevent to creditors from taking action. A bankruptcy court may also dismiss a bankruptcy petition with prejudice to prohibit further filings if necessary to prevent abuse of process or in response to egregious misconduct of the debtor. In general, a dismissal with prejudice must be premised on a demonstration of the debtor's bad faith.
Rights of creditors
If your bankruptcy petition is dismissed with prejudice, it means that your case has been terminated before its normal end. The position of both – you and your creditors revert to what they were prior to your bankruptcy filing. Creditors can take steps to collect their debts.
Getting Legal Help
Bankruptcy is a complex process. Don’t let your bankruptcy petition be dismissed with prejudice. This will affect your eligibility to seek bankruptcy protection in the future. Consult with an experienced bankruptcy attorney. The attorney can assist you with your filing.
