What is an adversary proceeding?

An adversary proceeding is a lawsuit within a bankruptcy case in Virginia. Adversary proceedings are typically initiated by creditors, who are the people or entities the debtor owes money to, or the bankruptcy trustee, a court-appointed officer. The purpose of an adversary proceeding is to determine if certain debts can be discharged, to determine the extent of a debtor’s liability on certain claims, or the validity, priority, or extent of another’s interest in the debtor’s assets. In Virginia, an adversary proceeding must be filed separately, not as part of the bankruptcy case. Adversary proceedings are unique cases before the bankruptcy court, with their own rules and procedures. An adversary proceeding requires the parties to file different papers, such as complaints and answers, conduct discovery, and possibly have a trial. An example of an adversary proceeding would be a creditor filing a lawsuit against the debtor to determine whether a debt is dischargeable in bankruptcy or to determine the amount of the debt. Adversary proceedings may also be filed to determine the validity of certain liens, the extent of another person’s interest in a debtor’s assets, or to determine whether a creditor has a right to set off a debt against the debtor.

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What is an adversary proceeding?

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