QUESTION
Can a personal injury award be taken in bankruptcy court for a debt that is my spouses?
Asked on Dec 19th, 2013 on Bankruptcy - New York
More details to this question:
My husband has a $36,000 debt which was included in our chapter 7 bankruptcy. I am being awarded money from a personal injury. I understand the award will be used for my creditors, but can they take it for my husbands creditors? My name is not on any his, not even as an authorized user. If I hadn't been injured, those creditors would be discharged. This is in New York.
1 ANSWER
The non-exempt funds remaining from the personal injury settlement will be used by your Trustee to pay creditors of the (joint) bankruptcy estate, which includes your creditors as well as his. Be certain that you have claimed all appropriate exemptions in the personal injury case. You should discuss this with competent local bankruptcy counsel.
Answered on Dec 23rd, 2013 at 8:54 PM