Bankruptcy in North Dakota is a legal procedure through which some of the debts of an individual or a business are discharged (excused). You should not view bankruptcy as an opportunity to eliminate your debts just because you don't feel like paying them - it can be a long and difficult process. Bankruptcy is designed to be a last resort to prevent complete financial ruin, while allowing creditors to collect at least some of their debts in an orderly fashion. Filing for bankruptcy can have major negative effects on one's credit score, which will make it more difficult to get loans in the future.
Accordingly, if you are considering bankruptcy as an option, you need to thoroughly examine the costs and benefits. A good North Dakota bankruptcy attorney can advise you as to the pros and cons of bankruptcy, and give his or her expert opinion about whether or not bankruptcy is a good option, based on the facts of your distinct case.
Types of Bankruptcy in North Dakota
Bankruptcy is governed by federal law, so the procedures in filing for bankruptcy in North Dakota will be the same as anywhere else in the United States. There are 2 basic types of bankruptcy that consumers typically use: Chapter 7, and Chapter 13, owing their names to where they are found in the U.S. Bankruptcy Code. Additionally, there is a form of bankruptcy normally used by businesses called Chapter 11. Chapter 11 is available to individuals, but it is rarely the best option for them.
Chapter 7 bankruptcy in North Dakota is sometimes called "liquidation" because it involves the forced sale of some (though certainly not all) of the debtor's assets. The bankruptcy court will appoint a trustee to oversee the appraisal and sale of some of the debtor's property, and the proceeds from the sale will go to the creditors, in their order of priority. Certain types of property are exempt, and do not need to be sold, including houses and insurance policies. Once the property is sold, and the proceeds given to the creditors, the rest of the debt is discharged. Chapter 13 bankruptcy normally reorganizes, rather than discharges, one's debts. Basically, the court will come up with some type of repayment plan, independent of the terms of the agreements that created the debt in the first place (superseding any acceleration clauses). This is meant to give the debtor some breathing room, allowing them to repay their debts over time, without facing financial ruin in the process.
Typically, it is businesses as opposed to individuals that avail themselves of Chapter 11 bankruptcy protection. Similar to Chapter 13, it entails reorganization of debt, rather than discharge. The debtor has to come up with a plan to reorganize its debts, and this plan must then be approved by a vote of the participating creditors. Once the plan is approved, the debtor has to carry it out.
How Can a North Dakota Bankruptcy Lawyer Help?
Because bankruptcy is a huge financial and life decision, it is not one to be made without as much information as possible. A North Dakota bankruptcy lawyer can help give you this information, and advise you as to whether or not bankruptcy is a prudent course of action, given your specific situation.
Interesting Facts About North Dakota
North Dakota is located in the Great Plains or "High Plains" of America, near the Canadian border. The state lies in the middle of the North American Continent; in the city of Rugby, a stone marks the "Geographic Center" of North America. With its central location, North Dakota is an important center for manufacturing in the U.S., especially in the area of technology.
North Dakota's highest court of law is the North Dakota Supreme Court. The court meets in the capitol building in the city of Bismarck. North Dakota's judicial branch is somewhat atypical because there is no permanent court of appeals. Instead, the Supreme Court is empowered to establish a "Temporary Court of Appeals". This temporary court is set up for specific claims and is presided over by a three-judge panel.
Other important courts in North Dakota are the Municipal Courts and the District Courts Many district courts in North Dakota have installed Odyssey systems, which allow for electronic filing of court documents. North Dakota is well-known for its extensive body of corporation law. In 1992, the Quill v. North Dakota case clarified rules for tax requirements for out-of-state corporations. The case is frequently cited, especially in relation to new developments like online sales taxes.
Lawyers in North Dakota typically file most lawsuits through the District Court system. North Dakota lawyers are skilled at interpreting the law and assisting clients with legal remedies. Attorneys in North Dakota tailor their legal services to the specific needs of the community.