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  1. #1
    Join Date
    Sep 2016
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    Default What Happens to a Personal Injury Award After Bankruptcy

    A plaintiff filed a product liability case. A year later, the plaintiff had to file Chapter 7 bankruptcy, and the product liability claim was listed as an asset of the estate. Six months post-discharge, a settlement has been reached and will soon be paid out. What happens to the settlement?

  2. #2
    Join Date
    Sep 2005
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    98,846

    Default Re: What Happens to a Personal Injury Award After Bankruptcy

    Unless the settlement is very small, it is likely that the trustee will ask that the settlement be applied to the benefit of the creditors from the bankruptcy. The bankrupt individual should not expect that they will be able to have the settlement deemed exempt from recovery by the trustee, and should contact his or her bankruptcy lawyer about the settlement.

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