Published On: September 20th, 2012 | Author: Perry Law, P.C. | Category: Bankruptcy Idaho
One recurring issue in bankruptcy proceedings is who has jurisdiction between a bankruptcy court and a state court. There are intricate rules as to core and non-core proceedings, which influence the decision. But, to complicate matters even further, the Bankruptcy Code provides for circumstances when a bankruptcy court must abstain from exercising its jurisdiction, and when it may abstain from exercising its jurisdiction.
28 U.S.C. Section 1334(c)(2) states seven requirements that must be met for when a bankruptcy court must abstain from exercising its jurisdiction. Those requirements are:
Furthermore, 28 U.S.C. Section 1334(c)(1) states that “nothing in this section prevents a district court in the interest of justice, or in the interest of comity with State courts or respect for State law, from abstaining from hearing a particular proceeding arising under title 11 or arising in or related to a case under title 11.” The Ninth Circuit has settled on twelve factors to consider when deciding whether to voluntarily abstain:
In re Tucson Estates, Inc., 912 F.2d 1162, 1166-67 (9th Cir. 1167).
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