Loading the player...

DEFINITION of 'Bankruptcy Court'

Bankruptcy courts are specialized, federal courtrooms created to settle all types of both personal and corporate bankruptcy cases. Unlike the federal court, which was established by the US Constitution, the bankruptcy court system was established by an act of congress in 1978 as part of the Bankruptcy Reform Act.

BREAKING DOWN 'Bankruptcy Court'

While most criminal, civil and family cases are heard in state courts, bankruptcy must be filed in a federal court, as the laws governing the bankruptcy process are federal, not state laws. There are 94 federal judicial districts throughout the United States, and each district has a bankruptcy court. The Federal Rules of Bankruptcy Procedure govern the bankruptcy process, maintaining consistency from state to state. The United States Court of Appeals appoints bankruptcy judges, who serve 14-year terms.

Federal law requires that a bankruptcy case be filed and heard in the judicial district that is the primary residence, place of business or site of the principal assets of the filer. If the filer disagrees with the bankruptcy judge’s decision, there is an appeal process. Appeals are generally handled by an appellate court, and many judicial circuits have bankruptcy-specific appellate courts to handle such disputes.

 

RELATED TERMS
  1. Technical Bankruptcy

    The state of a company or person who has defaulted on a financial ...
  2. Appellate Courts

    The appellate courts hear and review appeals from legal cases ...
  3. Voluntary Bankruptcy

    A type of bankruptcy where an insolvent debtor brings the petition ...
  4. Prepackaged Bankruptcy

    A plan for financial reorganization that a company prepares in ...
  5. Tax Court

    A specialized court of law that hears and adjudicates tax-related ...
  6. Bankruptcy Abuse Prevention And ...

    Legislation enacted by President George W. Bush in 2005 that ...
Related Articles
  1. Personal Finance

    Should You File for Bankruptcy?

    Find out how to determine whether bankruptcy will help or hurt your financial situation.
  2. Taxes

    Changing The Face Of Bankruptcy

    A 2005 law attempts to unmask fraudulent debtors and still save those who are struggling. Will it affect you?
  3. Taxes

    Tax Court: Your Last Resort

    Appealing an unfavorable or unfair tax ruling may be your last chance to save your finances.
  4. Taxes

    Bankruptcy Filing Changes That Could Affect You

    When the economy is down, more people file for bankruptcy. Make sure you know about the changes that have been made to this process.
  5. Personal Finance

    What You Need To Know About Bankruptcy

    Don't choose this last-resort option until you learn how it will affect your future.
  6. Insurance

    Personal Bankruptcies Cut Almost in Half After Obamacare

    Access to health insurance many have saved many Americans from going broke.
  7. Taxes

    How To Survive Bankruptcy

    Bankruptcy is not the end of the world. You can survive it and come out on the other side more financially solid.
  8. Small Business

    Alternatives To Business Bankruptcy

    Bankruptcy isn't the only alternative for a struggling business. It can try negotiating with creditors or liquidating assets outside the U.S courts.
  9. Taxes

    5 Myths About Personal Bankruptcy

    There are some persistent myths that hover over the process of bankruptcy that are either half-truths or completely false.
  10. Small Business

    7 Bankrupt Companies That Came Back

    Bankruptcy is often the end of a company – until it isn't.
RELATED FAQS
  1. Will filing bankruptcy stop an eviction?

    Learn about how filing bankruptcy can affect an eviction process, and find out what recourse your landlord has if you file ... Read Answer >>
  2. How will bankruptcy affect my ability to get credit in the future?

    Learn how filing bankruptcy affects your ability to obtain credit in the future, and find out how long a bankruptcy stays ... Read Answer >>
  3. Can I keep my credit cards after filing bankruptcy?

    Learn what happens to your credit cards after you file bankruptcy, and see when it might be possible to keep your card after ... Read Answer >>
Hot Definitions
  1. Swap

    A swap is a derivative contract through which two parties exchange financial instruments, such as interest rates, commodities, ...
  2. Yield Curve

    A yield curve is a line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but ...
  3. Gross Profit

    Gross profit is the profit a company makes after deducting the costs of making and selling its products, or the costs of ...
  4. Risk Tolerance

    The degree of variability in investment returns that an individual is willing to withstand. Risk tolerance is an important ...
  5. Donchian Channels

    A moving average indicator developed by Richard Donchian. It plots the highest high and lowest low over the last period time ...
  6. Consumer Price Index - CPI

    A measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, ...
Trading Center