What Does It Mean If Your Bankruptcy Case Is Dismissed With Prejudice?

When you file for bankruptcy, it is vital that you file correctly, accurately, and honestly, as there are consequences if you fail to do this. One such consequence is the potential for the bankruptcy court to dismiss your case. If the court dismisses it and labels it "dismissed with prejudice," it is not a good thing, and here are several things to understand about cases that are dismissed with prejudice.

What this means

When the court dismisses a case with prejudice, it means that you will not receive a discharge from the case, and instead, your case will be closed right away without any further action or consideration. A case dismissed with prejudice is never a good thing, and it will have consequences.

Why courts do this

There are a variety of reasons that courts will dismiss cases with prejudice, and the reasons usually come down to one of the following things:

  • You lied on your paperwork.
  • You omitted things from your paperwork.
  • You disobeyed the law or a court's order.
  • You tried to abuse the system in some manner.

When you file for bankruptcy, the trustee will fully evaluate and research all the information you provide. If there are discrepancies in any way, the trustee may question you about them first but will then have the right to dismiss your case.

Consequences of this

If you end up getting your case dismissed with prejudice, you will face several different consequences. The first consequence is that you will lose the money you invested in filing. You cannot get a refund on your filing fees or the legal fees you spent to file your case, so you would have wasted your money on these things.

The second main consequence of getting your case dismissed with prejudice is that it can limit when you file again or if you file again. The court has the right to extend the time frame in which you must wait before filing again, and the court also has the right to prohibit you from ever filing again. These consequences are severe, but they are in place to protect the bankruptcy system, and you will need to make sure you fully understand these things when you file.

If you want to prevent this from happening, you must avoid lying on your bankruptcy paperwork. Any type of lie or omission could lead to problems and could prevent you from filing again. To learn more about bankruptcy, contact a lawyer at a firm like McFarland & Masters LLC today.