Personal Bankruptcy Help

[RJZII]

Jurisdiction

Florida

Thank you in advance for answers and information!!
In state of Florida, if a chapter 7 bankruptcy is filed before an accident occurs that will result in a financial award, is any award safe from the bankruptcy estate because it was filed prior to said accident ?

 

[adjusterjack]

is any award safe from the bankruptcy estate because it was filed prior to said accident ?

Depends on how long after the bankruptcy was filed.

"...the Bankruptcy Code does provide that if the debtor becomes entitled to a financial windfall within 180 days after the bankruptcy case is filed, the property receive is also part of the bankruptcy estate, and must be turned over to the creditors. It is important to understand that this rule applies to assets the debtor becomes entitled to even if they don't actually take possession of the asset during this time period. "

Quoted from:

Financial Windfalls After Filing Bankruptcy | Texas Bankruptcy Attorney (bankruptcyinfo-dallas.com)

All that tells me is that it's "possible" that the settlement or award may have to be included in the bankruptcy estate. There could be many variables involved in the reality of any particular situation that might change that.

 

[zddoodah]

The answer to your question depends on the specific facts, which you did not provide. If you are in the situation you described, you need to discuss the matter with your bankruptcy attorney.

 

[RJZII]

The answer to your question depends on the specific facts, which you did not provide. If you are in the situation you described, you need to discuss the matter with your bankruptcy attorney.

Thank you
Actually that is why I am here
I have gotten an overload of incorrect information from my bankruptcy attorney thus far
In dec 2019 I started paying a national firm for a chapter 7 as I was getting divorced and my wife racked up a lot of debt. This firm appointed a local attorney for me who soon AFTER became my divorce attorney. After I made all my payments to the national firm, for reasons unanswered to this point, the local attorney did not file expeditiously and several weeks later I was hit by a business van on the highway resulting in numerous injuries which in time I will be entitled to a settlement for. Would it not have been in me and my 5 years old daughters best interest to file immediately for bankruptcy? Especially since he had all my financial information and knew the brutal nature and intimate details of what ex wife had put myself and daughter through
I won't jam U up with more details although I have many but I certainly appreciate any wisdom U could bestow upon me
Thank you

 

[zddoodah]

Would it not have been in me and my 5 years old daughters best interest to file immediately for bankruptcy?

No one here could have the slightest idea because we know nothing about your current financial situation, much less your financial situation as of two years ago when you filed.

Is your Ch. 7 case, which was filed in December 2019, still ongoing? Or have you been discharged?

 

[RJZII]

My inability to control my ex wife spending during our marriage left me broke and in 40 grand of debt.
Still broke barely making it by working as much as possible for my 5 year old daughter
Cannot work the same jobs or as much as I used to due to ongoing injuries from auto accident.
I started making payments for chapter 7 November 2019
Payments were completed July 2020
Bankruptcy was not filed in timely mannner
Sept 2020 auto accident
Lawyer told me that a chapter 13 must be filed so any settlement would be protected and I would have to pay $100 a month to bankruptcy estate.
This turned out to be incorrect and lawyer told me he had been "mis informed "
Now he says I have to pay $1000 a month
Accident case will be moving forward in 2022 but have no idea what will happen as that moves on
Thank you for your time and information!!!

 

[zddoodah]

Sounds like you may be in need of a new attorney.

 

[despritfreya]

From your posts above, accident happened before you filed and your accident related claims have not been settled so here are the general rules:

Chapter 7:
Any potential recovery, no matter when it comes in, is an asset of the bk estate and can only be protected to the extent of an allowed exemption - otherwise Trustee has the right to the claim. You lose all control.

Chapter 13:
Accident claim is still property of the estate but you can keep control over it. Proceeds from any settlement (or its equivalent value), unless exempt, go to the creditors through the Chapter 13 Plan up to 100% of the timely filed and allowed claims. Google "meeting Chapter 7 Reconciliation" and "best interest of the creditors test".

Either way, creditors get the benefit of the asset unless there is an exemption that keeps it away from them. The difference is:

In a Chapter 7 the Trustee is looking for a "quick" settlement and will settle for less that what the claim may be worth.

In a Chapter 13, since you maintain control, you may be able to get more money since you are not in any particular rush to settle.

Des.

 

[despritfreya]

@adjusterjack
I just saw your post. IMHO, the Dallas bankruptcy attorney's website should not be relied upon. The following is a misstatement of the law unless this attorney can point to case authority that stands for such proposition:

". . . the Bankruptcy Code does provide that if the debtor becomes entitled to a financial windfall within 180 days after the bankruptcy case is filed, the property receive is also part of the bankruptcy estate, and must be turned over to the creditors."

I note that the words "financial windfall" do not appear in the Bankruptcy Code.

Even worse is the claim that lottery winnings are included in this 180 day period. Again,
unless this attorney can cite to specific case authority this is wrong.

Using the lottery ticket as the example:

If the debtor purchased the lottery ticket the day before filing then the winnings are property of the estate regardless of what Chapter is filed. See generally, 11 U.S.C. § 541.

In a Chapter 7, if the debtor purchased the ticket the day after filing, the winnings are not property of the estate. In the context of the post petition "windfall" the debtor may face a Motion to Dismiss the case "for cause" under 11 U.S.C. § 707(a) (now having the ability to pay creditors), but the windfall does not go to the Trustee as property of the estate.

In a Chapter 11, 12 or 13 after acquired property is property of the estate if it would have been considered property of the estate had it been in the debtor's possession before filing. Again, this has nothing to do with a 180 day window. See: 11 U.S.C. § 1115; 11 U.S.C. §1207; and 11 U.S.C. § 1306.

This attorney is presumably referring to 11 U.S.C. § 541(a)(5) which limits the 180 day inclusion to three specific items, 1) bequest, devise, or inheritance; 2) property settlements; and 3) beneficiary of life insurance policy or death benefit plan.

Just wanted to clarify this.

Des.