QUESTION
Will filing for bankruptcy take care of my lawsuit?
Asked on Jul 26th, 2011 on Bankruptcy - Virginia
More details to this question:
A former business deal went sour and the guy is suing me for a promissory note. The case is now pending. The amount is too huge that I can't afford to pay if I lose. I'm considering filing for Chapter 7 (and will qualify because all my debts are business related) but am worried that the trustee might "step into the shoes" of the creditor and demand me to pay nonetheless, which defeats the purpose of filing for bankruptcy. What should I do or expect? Should I file for Chapter 7? I have no assets and am flat out broke. Thank you for your time.
9 ANSWERS
Bankruptcy protects the debtor from continuing efforts at collecting a debt that is subject to discharge. In Chapter 7, you will get the benefit of the discharge of this type of debt and if you have no assets that are "non-exempt" then you will be able to keep everything and will not be asked to pay anything back to creditors of this type.
Answered on Aug 04th, 2011 at 3:08 PM
Talk to an attorney! You have concluded that you will"qualify" for a chapter 7, maybe an expert ought to make that decision! When you file for chapter 7 you are jumping out of an airplane - do you want to be sure there is a parachute on your back? You cannot get back to the plane, so an attorney's advice is an absolute necessity. You should expect that you will be taken to the cleaners without competent guidance.
Answered on Jul 29th, 2011 at 8:51 AM
If you are broke they will have no purpose suing you and yes a bankruptcy will take care of the debt
Answered on Jul 27th, 2011 at 7:59 AM
Bankruptcy Attorney serving Concord, CA
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William Rubendall Attorney at Law
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One reason for filing chapter 7 bankruptcy is that you are being sued. In a chapter 7ifyou are suing the lawsuit is considered an asset that is owned by the trustee. When you are being sued the trustee does not pursue the lawsuit against you, rather it is discharged (wiped out.)
Answered on Jul 26th, 2011 at 4:28 PM
Glen Edward Ashman
Your question reveals many misconceptions about bankruptcy. The trustee does not represent the creditors as a collector on lawsuits. And whether you qualify to file bankruptcy or not is based on many things other than whether your debts are business or personal. Whether the debt in the suit is dischargeable or not depends on the specific nature of the debt and how it arose. Most debts are dischargeable; some are not. Neither bankruptcy nor the defense of large business lawsuits are pro se projects. You need a lawyer. See one ASAP.
Answered on Jul 26th, 2011 at 4:14 PM
If the suit is for payment of an unsecured promissory note only, it will be discharged in bankruptcy.
Answered on Jul 26th, 2011 at 4:13 PM
Samuel Lee Tucker
Yes, a Chapter 7 will stop the lawsuit.
Answered on Jul 26th, 2011 at 3:35 PM
Spencer Hale
If it is just a simple contract dispute and your ex-business partner claims you owe him money for breach of contract, you will likely be able to discharge it in bankruptcy. One thing to keep in mind is that just because the majority of debts are business related, does not mean that you automatically qualify for a chapter 7.
Answered on Jul 26th, 2011 at 3:02 PM
Bankruptcy Attorney serving Herndon, VA
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Maureen O'Malley
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If you signed personally for the debts, you can file bankruptcy on them. If the business is still ongoing and showing any promise the trustee may want to step into your shoes, but you should be released in the absence of any fraud. Have a lawyer do it for you because there will be additional steps you'll need to take.
Answered on Jul 26th, 2011 at 2:31 PM