In Marcia T. v. Raymond W., 2009 NY Slip Op 51883U (Albany County 2009), a father who had filed for Chapter 13 bankruptcy argued that this bankruptcy filing should stay the confirmation of a finding that he willfully violated a prior support order. His argument relies on the automatic stay provisions of the bankruptcy code which provide that the filing of a bankruptcy petition operates as a stay for actions to recover a claim against the debtor that arose prior to the commencement of the case.
The Family Court agreed with the father and held that his filing under Chapter 13 of the U.S. Bankruptcy Code stays all proceedings to collect prior claims against the debtor and his property. Because the debtor must make payments to creditors from his post-filing earnings, those earnings are the property of the Chapter 13 bankruptcy “estate”.
However, although the Court held that it was precluded allowing a recovery of arrears while the Chapter 13 bankruptcy plan was in effect, it was not prohibited from confirming the willful violation finding and simply staying enforcement until the Chapter 13 bankruptcy plan was completed.
The Court held that if the payment of arrears to the mother was not satisfied by the time the bankruptcy plan was completed, the mother could restore the violation to the Family Court’s calendar to seek the payment of arrears owed to her.
