I sued multiple defendants and was late arriving on the day of trial. One of the defendants had filed bankruptcy the day prior but had not filed notice of stay with the state court in our case. Before I arrived the court had dismissed the case and stated that I needed to set it aside. I talked to an attorney and they said that even though the court dismissed it was void because of the automatic stay. Do I need to set it aside or did the court not have jurisdiction if a party filed bankruptcy?
If the court dismissed the entire case, you would have to move set aside the dismissal as to the defendants who did not file bankruptcy. The automatic stay stops actions to collect on debt. Dismissing the case as to the chapter 7 filer was not a violation of the automatic stay, since it was not an action toward collecting the debt, but one that actually stopped an action to collect.
Based upon your explanation of the facts, the superior court could dismiss the entire action even if one of the defendants was in bankruptcy. The superior court had jurisdiction. Dismissing the case as to the debtor in bankruptcy was not a violation of the automatic stay.
You will need to make a motion under Code of Civil Procedure section 473 to set aside the dismissal.
Frank W. Chen is licensed to practice law in the State of California. The information presented here is general in nature and is not intended, nor should be construed, as legal advice. This posting does not create any attorney-client relationship with the author. For specific advice about your particular situation, consult your own attorney.
You will need to file a motion to set aside the dismissal against the defendants who did not file bankruptcy. You may need to first seek relief from the automatic stay in the bankruptcy before moving to reactivate the state court action against the bankrupt defendant. There may also be a joinder issue if the bankrupt party is indispensable or named in a cross-complaint. I hope you have retained good counsel.
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