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Views of William C. Behrndt on Bankruptcy and Family Law

November 6, 2011

In the past few years family law has expanded to take into account several issues concerning grandchildren, stepchildren as well as agreements and obligations between unmarried cohabitants, including gay and lesbian couples. According to William C. Behrndt the bankruptcy laws framed many years back have lagged behind in addressing these developments. As initially enacted in 1978, the Bankruptcy Code did not except from discharge orders for the support of children born out of wedlock, the rights of parties to annulled marriages remain unclear, and other family-related obligations are not even addressed in the Bankruptcy Code.

Until 1984, the Bankruptcy Code had no specific provision that prevented the discharge of an order that the debtor support a child born out of wedlock. Prior to that time, the Bankruptcy Code applied only to debts ”in connection with a separation agreement, divorce decree, or property settlement agreement.” The Bankruptcy Amendments and Federal Judgeship Act of 1984 amended the Bankruptcy Code by adding the language ”or other order of a court of record” to the list of obligations for support of a child, spouse, or former spouse of the debtor.

The language was again amended by the Bankruptcy Judges, United States Trustees, and Family Farmer Bankruptcy act of 1986, which broadened the section to include support determinations by governmental units other than courts, such as administrative agencies. The Bankruptcy Reform Act of 1994 added further protections for support orders owed to children born out of wedlock. To the extent such orders have not been assigned, prepetition debts owed under such orders are priority claims, payments on such debts cannot be avoided as preferences, and judicial liens for such debts probably cannot be avoided. In addition, the automatic stay no longer prohibits an action to establish paternity or a proceeding to establish or modify child support. The language of the Bankruptcy Code provides that a child support obligation not arising in connection with a separation agreement, divorce decree, or property settlement agreement must arise in connection with a court order or determination of a governmental unit in order to come within the scope of that nondischargeability provision. An agreement by a parent to support a child born out of wedlock, even if in writing, is outside the scope of those sections unless it was in connection with the unmarried parents’ separation, in which case it might be considered a ”separation agreement.”

According toLaw Office of William C. Behrndt When a paternity settlement has not been incorporated into a court order or determination of a governmental unit, a substantial risk exists that it will not survive bankruptcy because it does not fall within the ”court order or determination of a governmental unit” language. For children born of a marriage, an agreement between separated parents providing for child support creates a nondischargeable obligation, whether or not embodied in a court order or determination of a governmental unit. For children born out of wedlock, it may not. Article Source : http://www.oclaw.com/bankruptcy.html

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