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Related Articles: Bankruptcy

This article is intended to provide general information on Virginia law, and is not intended to be relied upon as a substitute for legal advice for specific situations. The contents of the article may be out-of-date, since it was produced at a specific time and may not have been updated.

Arbitration and Mediation in Bankruptcy

Alternative Dispute Resolution is expanding in many areas of the law, including the Bankruptcy Courts. With the tremendous number of bankruptcy filings in the early 1990's, the Bankruptcy Courts have become overloaded with lawsuits within the context of a bankruptcy. As a result, bankruptcy estates are becoming the subject of expensive litigation. This can be devastating to both debtors and creditors who are fighting for limited assets. Litigation in bankruptcy can diminish bankruptcy estate resources. A number of attorneys and judges in Virginia and Washington, D.C. recognized the need for resolving disputes quickly and inexpensively in the bankruptcy setting and have very recently created an organization called BAMS (Bankruptcy Arbitration and Mediation Services).

BAMS provides parties to bankruptcy related disputes an impartial, confidential, less expensive, accelerated alternative to litigation. The Arbitrators and Mediators are former Trustees, former Judges and Bankruptcy attorneys. The service provides mediation, mini-trials and arbitration. BAMS is a non-profit organization designed to save money, save time, restore control to the parties, narrow and reduce issues, preserve relationships and keep reputations intact. While only recently created, BAMS is already proving to be a successful alternative to traditional litigation in bankruptcy.

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