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How Likely Are Virginia Bankruptcy Courts To Stay Open During Shutdown?

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Forced laborOctober 11, 2013

by John G. Merna

Faced with the loss of operating funds on October 17th, despite the “self-funding” that has permitted the U.S. Bankruptcy Court for the Eastern District of Virginia to maintain operation during the shutdown, it is likely that Chief Judge Stephen St. John  will issue an order shortly stating that court staff are “essential” to the continued operation and processing of cases and are to remain on the job during the government shutdown.

At the beginning of the government shutdown the Administrative Office of the United States Courts issued an announcement that the judiciary would remain open through October 17, 2013.  This projection apparently was based on funding from fee income and “no-year” appropriated funds.  Spending restrictions would be in place.

However, as of today no statements have been issued  from the Administrative Office of the United States Courts to explain how the bankruptcy courts will continue to fund themselves.  Several bankruptcy judges throughout the country, including in the Central District of California and the Western District of Pennsylvania, have issued orders deeming court personnel “essential” and ordering them to report during the shutdown.

Judges have a constitutional guarantee of payment, however, employees do not.  The question of the constitutionality of such orders has not been address in the public media.

Nevertheless, it is likely, in my opinion, that the U.S. Bankruptcy Courts of the Eastern and Western Districts of Virginia will follow suit with similar orders to maintain case processing during the government shutdown.  The Eastern District of Virginia includes the bankruptcy courts located in Norfolk, Newport News, Richmond, and Alexandria.

Bankruptcy relief is an essential element in our financial system.  At a time when the economy is struggling, leaving taxpayers unprotected from foreclosures, garnishments, lawsuits, etc., would create pressure on the countries social welfare systems which are also not being funded during this shutdown.  Many people who could have otherwise recovered would be made homeless and jobless and would require public financial assistance were the option for bankruptcy protection not to remain in place.

On a personal note, I appreciate all the thanks from our blog readers and clients about the posting sent out to try to keep them informed about the impact of the shutdown on their cases.  To link to this stream of postings just “friend” us on Google+.  I would also appreciate if you would Google +1 this page at the top and our bankrupty page to help others find this information. Stay tuned.





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