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  1. #1
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    Nov 2019
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    Default 11 U.S. Code and 8239;523 Claims

    My question involves bankruptcy in the state of: NY

    If the entity your suing or about to sue files bankruptcy before you can bring a claim that they obtained some of your money by fraud and experienced personal injury based on the fraud, and the finding of fraud is liquidated in the claims process which would support your personal injury claim, then is that now a debt that is an exception to discharge under 11 U.S. Code  523? Or does the court need to find also that the defendant acted with malice?

  2. #2
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    Default Re: 11 U.S. Code and 8239;523 Claims

    Quote Quoting nobeefcow
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    My question involves bankruptcy in the state of: NY

    If the entity your suing or about to sue files bankruptcy before you can bring a claim that they obtained some of your money by fraud and experienced personal injury based on the fraud, and the finding of fraud is liquidated in the claims process which would support your personal injury claim, then is that now a debt that is an exception to discharge under 11 U.S. Code  523? Or does the court need to find also that the defendant acted with malice?
    If the bankruptcy court determines that the debt was the result of fraud perpetrated by the debtor then that debt is excluded from the discharge. There is no malice needed.

  3. #3
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    Default Re: 11 U.S. Code and 8239;523 Claims

    Here's your problem.

    If the entity files Chapter 7 there is no Section 523 cause of action since entities do not get discharges and 523 only applies to individuals in Chapter 7.

    If the entity files for Chapter 11 and confirms a Chapter 11 Plan of Reorganization, Section 523(a)(2) only applies under certain circumstances as described in 11 USC 1141(d)(6)(A), which probably does not apply in your situation.

    You need to talk to a well qualified attny.

    Des.

  4. #4
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    Default Re: 11 U.S. Code and 8239;523 Claims

    Quote Quoting despritfreya
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    Here's your problem.

    If the entity files Chapter 7 there is no Section 523 cause of action since entities do not get discharges and 523 only applies to individuals in Chapter 7.

    If the entity files for Chapter 11 and confirms a Chapter 11 Plan of Reorganization, Section 523(a)(2) only applies under certain circumstances as described in 11 USC 1141(d)(6)(A), which probably does not apply in your situation.

    You need to talk to a well qualified attny.

    Des.
    What if the entity is a DIP and confirms a Chapter 11 Plan for liquidation? In this particular case, there is a consumer creditor committee and the attorney in this case is well qualified. And she is busy. I was just wondering if those claims are dischargable by law because it is rather confusing. Fascinating but damn confusing.

    Quote Quoting Taxing Matters
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    If the bankruptcy court determines that the debt was the result of fraud perpetrated by the debtor then that debt is excluded from the discharge. There is no malice needed.
    Thank you. I thought that is how it read but I'm not a lawyer so I can never be sure!

  5. #5
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    Default Re: 11 U.S. Code and 8239;523 Claims

    Quote Quoting nobeefcow
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    What if the entity is a DIP and confirms a Chapter 11 Plan for liquidation?
    All Chapter 11 debtors are "Debtors In Possession" unless a Trustee is appointed. Confirmed Plans can be used to reorganize or liquidate.

    I did not get involved in your other thread due to various reasons that I will not elaborate on. Read the Code and find a good, well qualified bk attny.

    Des.

  6. #6
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    Nov 2019
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    Default Re: 11 U.S. Code and 8239;523 Claims

    Quote Quoting despritfreya
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    All Chapter 11 debtors are "Debtors In Possession" unless a Trustee is appointed. Confirmed Plans can be used to reorganize or liquidate.

    I did not get involved in your other thread due to various reasons that I will not elaborate on. Read the Code and find a good, well qualified bk attny.

    Des.
    Well now I'm really intrigued... what other thread because I had two. But just to be clear, what about the personal injury claim attached to the tort? Dischargable?

  7. #7
    Join Date
    Sep 2010
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    475

    Default Re: 11 U.S. Code and 8239;523 Claims

    Quote Quoting nobeefcow
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    Well now I'm really intrigued... what other thread. . .
    https://www.expertlaw.com/forums/sho...d.php?t=245080

    Des.

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