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I used a promissory note to loan money to a family friend. Now they are including it in their bankruptcy even though the note expressly stated that they would not be able to do this. What can I do to stop this? Can I just send a copy of the promissory note to someone involved?
6 ANSWERS
Commercial & Bankruptcy Law Attorney serving Powell, OH
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Ronald K. Nims
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There is nothing you can do about it. Your loan will be discharged in bankruptcy. Bankruptcy supersedes the terms of contracts, so you can write anything you want into the contract and it won't make a bit of difference.
Answered on Jun 16th, 2015 at 10:06 AM
Those types of agreements are unenforceable in a BK filing. Otherwise every creditor would include the language in their agreements. Pay an experienced BK lawyer for two hours of their time to review the BK filing (they can do this from their office using Pacer). They can then advise you of all of your rights, and what options are available to you. For example, can you object to the discharge of your debt? (see 11 USC 523). Can you object to the debtor getting a discharge at all? (see 11 USC 727). Time is of the essence, so act with all due speed!
Answered on Jun 15th, 2015 at 4:10 PM
A promise not to file bankruptcy is not an enforceable agreement under federal law.
Answered on Jun 15th, 2015 at 3:55 PM
Bankruptcy Attorney serving Madison, WI
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Richard B. Jacobson & Associates, LLC
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No. The loan will be discharged whether a document purports to waive the right to discharge it. There is little to do if the loan was a garden variety kind of debt. Some classes of debt get special preference or priority in a bankruptcy, or are not dischargeable at all. But the vast majority of claims are simply lost to the creditors. Consult a tax expert: there may be some tax benefit from having a claim you own discharged in a bankruptcy. Good Luck.
Answered on Jun 15th, 2015 at 3:09 PM
Unless the note was expressly secured by real property or physical property and the appropriate documents to secure the debt were executed, this is an unsecured debt like any other. The language in the note does not trump federal law. Perhaps if they led you to believe this you can avoid the discharge of this debt on the basis of fraud, but that's unlikely.
Answered on Jun 15th, 2015 at 2:53 PM
Bankruptcy Attorney serving Livonia, MI
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Charles J. Schneider, P.C.
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A person cannot sign away their right to file bankruptcy. You need to consult with an attorney about what other remedies you may have.
Answered on Jun 15th, 2015 at 2:00 PM