In re Lawrence Wohleber, Jr.

After a settlement in his divorce proceeding, Debtor filed a Chapter 13 bankruptcy petition. Debtor was subsequently confined to jail for failure to pay the court-approved settlement. Debtor filed an adversary complaint seeking damages under 11 U.S.C. 362(k) for violations of the automatic stay by his former wife, Skurko, and her attorney, Gentile, by allowing the post-petition sentencing portion of a pre-petition contempt proceeding to continue despite knowing that the automatic stay was in effect. The bankruptcy court found no violation because the two did not take affirmative action post-petition to try to collect the debt, and there was no affirmative action they could take to prevent the domestic relations judge from jailing Debtor for nonpayment because the contempt motion was already ruled upon. The Sixth Circuit Bankruptcy Appellate Panel reversed. Upon the filing of Debtor’s bankruptcy, it was incumbent upon Gentile and Skurko to seek relief from the stay or to obtain a bankruptcy court determination that the stay did not apply. A creditor cannot sit idly by, appear at a collection proceeding, and allow the debtor to be jailed because he did not pay the judgment creditor’s dischargeable debt. The burden was on the creditor and her attorney to stop the proceeding once the bankruptcy was filed. View "In re Lawrence Wohleber, Jr." on Justia Law