Can Someone Tell You They Are Filing for Bankruptcy, then Not File Until a Year Later

My question involves bankruptcy in the state of: PA

I have a contractor that owes me money. They were given a down payment, but I ended up having to cancel the contract. Then, less than a week later told me they were seeking legal counsel on this and other matters and would be filing for bankruptcy within the week. I do have actual proof of them stating about bankruptcy.

The person did not file for bankruptcy until almost a full year later. Is this legal? I didn't think someone could seek legal counsel on a bankruptcy, tell people they were going to file for bankruptcy, and do it at a much later time then they stated. Since the time he told me he was filing, he also took on additional debt that he also put onto his bankruptcy. From the date he told me, up until the actual time he filed, wouldn't that make all debt between that period non-dischargeable? Since he knowingly took on debt that he could not handle.

I'm pretty sure there's no chance of me getting any money back, but can I use this information against his bankruptcy?

It may not be “morally” right for someone to tell you he/she is filing bk and then actually file a year later but there is nothing legally wrong with it.

The fact is you had the right to proceed with whatever legal remedies you thought you had until he/she filed bk. You chose not to based upon someone’s statement. Not a lot you can do now except learn not to believe someone who threatens bk until there is a bk case number. As to the run up of debt in that one year, such is between the debtor and the actual creditor - not your issue.

You state that you canceled the contract. Why would a contractor owe you money if you breached the contract unless there was a refund provision? You might want to review 11 U.S.C. 507(a)(7) to see if you fit into that category of priority creditors should there be assets distributed in the bk. Also, assuming there was a refund provision in the contract, if this was a construction project go to your state’s registrar of contractors web site to see if there is some recovery fund you can claim against.

Des.

Deadbeats tell creditors all the time that they will file for bankruptcy. Nothing illegal about it.

Smart creditors don't fall for that line.

You fell for it.

In fact, you don't *EVER* want to wait even if they are on their way to the courthouse to file the paperwork when they make the statement.

Live and learn.

The contractor did not include the right to rescission within three business days on the contract. If it had I would of on the 2nd business day when I found out the seller couldn't close. He I did send a notice of cancelation on the 5th business day, but from what I've read the 3 day period doesn't go into effect until you are given written notice of your right to rescission. Is this true?

He also added in the contract that it complied with all PA state laws and from what I read the right of rescission is PA state law required in contracts.

Is this true?

Quote:

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Quoting cypher3d

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Live and learn.

The contractor did not include the right to rescission within three business days inside of the contract. If it had I would of on the 2nd business day when I found out the seller couldn't close. I did send a notice of cancelation on the 5th business day, but from what I've read the 3 day period doesn't go into effect until you are given written notice of your right to rescission. Is this true?

Is this true?

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Where are you getting the idea that you even had a three day right of rescission?

PA Unfair Trade Practices and Consumer Protection Law states the right to recission in section 7

If I misread it or you need more information please let me know

Was the service sold to you in your home?

No it was not. He called me and talked me through things he could and couldn't do etc when I was at home and he wrote up a contract. For the actual contract he had me sign it at the property the work would be done at.

Then there is no right of rescission. The right exists only for goods/serviced sold to you at your home (or over the phone).