West Virginia businesses and Individuals may qualify to file for bankruptcy in a federal court under West Virginia Chapter 7 (liquidation), Chapter 11 (reorganization) or Chapter 13 (reorganization). Clagett Law Office serves individuals and small businesses within counties of the Northern District of West Virginia.
Bankruptcy in the United States is permitted by the United States Constitution (Article 1, Section 8, Clause 4) which authorizes Congress to enact "uniform Laws on the subject of Bankruptcies throughout the United States." Congress has exercised this authority several times since 1801, most recently by adopting the Bankruptcy Reform Act of 1978, in Title 11 of the United States Code, commonly referred to as the Bankruptcy Code. The Code has been amended several times since 1978, most recently in 2005.
While bankruptcy cases are filed in United States Bankruptcy Court (units of the United States District Courts), and federal law governs procedure in bankruptcy cases, West Virginia bankruptcy laws are applied when determining property rights. For example, law governing the validity of liens or rules protecting certain property from creditors (known as exemptions), derive from West Virginia bankruptcy law. Because West Virginia state law plays a major role in many bankruptcy cases, it is often unwise to generalize some bankruptcy issues across state lines.
Eligibility for Bankruptcy in West Virginia is partly determined by the bankruptcy means test.