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  1. #1
    Join Date
    Dec 2011
    Location
    Small Town, Iowa
    Posts
    24

    Default Sued for Vehicle Damage After Chapter 7 Discharge

    My question involves bankruptcy in the state of: Iowa

    Okay...here's the thing. My income is less than desirable...and I was awarded a Chapter 7 Bankruptcy. I did it all Pro Se' and was also granted a waiver of all court charges due to my income...so no lawyer involved. Chapter 7 discharged April 2011.

    An ex is just now suing me for damages to a vehicle (pls refer to other post in hx for questions on that) that happened Dec 2009. I would have included this on Schedule F as a creditor had I realized it was a legitimate debt...and he ever requested money for this. It was an accident due to weather conditions...not negligence)

    I have not responded to the summons..I will in the time frame given. My question: All states and courts differ on this: Some will automatically state it was included in bankruptcy regardless if on Schedule F or not...others will expect case to be requested reopened to amend the Schedule F. Then...there are some that may deny including this debt...thought I think that is more rare.

    Any ideas on my first step? I am contemplating paying a lawyer for an hour visit just to get advice...I know reopening a case to amend anything can get tricky...I did it all on my own before...so I am not ignorant...but I need to do this right. Its just that money is so tight right now...I am just now beginning to get back on my feet...and even an hours worth of fees would be a setback.

    Thank you kindly...

  2. #2
    Join Date
    Apr 2010
    Posts
    238

    Default Re: Discharged Chapter 7 in April 2011.ex Now Suing for Damages to a Vehicle

    If I understand correctly, your ex is threatening to sue you in small claims court for damages to his UN-insured vehicle in an accident that occured in '09? Your bankruptcy, discharged in 04/11, only applies to legal debts incurred prior to the discharge of those debts. Since your ex has not prevailed in his threatened action against you there is no debt owed that could have been discharged by the bankruptcy proceedings.

    My advice would be to let him carry on about his business if he should choose to do so. If he wants to file a lawsuit against you, respond to the summons. Then you can testify that you refused to participate in his "demand" to commit insurance fraud (so he could recoup his losses) and that it ended your relationship with him. He might not be so keen to have that information laid out for all the world to see in court.

  3. #3
    Join Date
    Sep 2005
    Location
    Behind a Desk
    Posts
    98,846

    Default Re: Discharged Chapter 7 in April 2011.ex Now Suing for Damages to a Vehicle

    The alleged debt relates to the property damage, not to a theoretical judgment from the property damage. A contingent obligation is dischargeable in bankruptcy even if there is no judgment.

    As this is described as having been a zero assets Chapter 7 discharge, the discharge should extend to debts not listed on the schedules. If necessary you can petition the court to amend the judgment to include the new claim but that should not be necessary. The schedules are not intended as a trap, and it's a given that debtors will at times accidentally omit creditors or forget about old debts.

    I suspect this is a small claims case; if it's a case filed by a lawyer, consider documenting the discharge to the lawyer and see how the lawyer responds. If not you can consider other options, including filing a motion in the bankruptcy court to declare this debt discharged, or raising the discharge as an affirmative defense and providing a copy of the order of discharge along with your answer.

    In small claims court you sometimes get magistrates or judges who are not familiar with the intricacies of federal law or bankruptcy, so if the court doesn't immediately recognize and understand the significance of the discharge you need to be prepared to document your position (or proceed in the bankruptcy court).

  4. #4
    Join Date
    Dec 2011
    Location
    Small Town, Iowa
    Posts
    24

    Default Re: Discharged Chapter 7 in April 2011.ex Now Suing for Damages to a Vehicle

    Thank you kindly...I feel much more secure moving forward...Michelle

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