In re: Wiley, No. 4:10-bk-40808-EWH (Bankr. D. Ariz., June 3, 2011).
Where can you file a bankruptcy case? A recent Arizona bankruptcy court was met with this issue for debtors with connections in three different states.
In the midst of divorce proceedings, Robert Wayne Wiley and Teresa Lynn Wiley filed a joint Chapter 7 petition. Robert lived at the time in Tucson, Arizona, and Teresa lived in Krum, Texas. They had a home in Reno, Nevada. Understandably about the residences, the trustee filed a motion to dismiss the case as to the wife, as she had never resided in Arizona, and was therefore ineligible to file there.
In their response, Robert and Teresa explained that they both lived in Reno until September, 2010, where they acquired their residence.
The location a debtor chooses to file in is presumed to be proper. The party challenging the venue bears the burden of establishing by preponderance of the evidence that venue is in fact improper. Under the Bankruptcy Code, a debtor may file where, for the 180 days preceding the petition date, the debtor is domiciled, resides, where his principal place of business is situated, or where his principal assets are located.
Teresa claimed she filed in Arizona because her principal assets were located there, since her husband brought most of their assets from Reno to Tucson with him. The court, however, disagreed, finding that Robert had moved to Tucson only 112 days prior to filing, so the filing was improper for both Teresa and Robert. The debtors' case was dismissed, and they were instructed to file their joint case in Nevada.
