Filing for bankruptcy can have a significant impact on divorce proceedings in Texas, particularly when it comes to dividing marital assets. When a spouse files for bankruptcy, an automatic stay goes into effect, which halts the continuation of any judicial proceedings, including divorce cases. This stay is especially relevant if the divorce proceedings involve dividing the marital estate.
The automatic stay effectively deprives state courts of jurisdiction over the debtor’s property until the stay is lifted or modified. Any actions taken by the court in violation of this stay are considered void, not just voidable. This means that a judgment or decree issued during the stay can be challenged as fundamentally flawed, even on appeal.
Understanding the interplay between bankruptcy and divorce is crucial, as it can delay proceedings and complicate the division of assets. If you’re involved in a divorce where bankruptcy is a factor, seeking legal advice to navigate these challenges is essential.