Filing Chap 7 or 13 bankruptcy. Have had litigation going on from a car accident 18 months ago. If the litigation settles in the middle of the bankruptcy proceedings, can the courts take away monies awarded in the litigation?
Maybe, but not certainly. You don't mention a dollar amount. Some of the money coming from your settlement might be available to your creditors, but at least some of it will most likely be exempt. Assuming that you have lived in California for at least the last 3 years, you will qualify for a $21,825 "wildcard" exemption, to protect property such as bank accounts and this settlement (there are other exemptions for other types pf property, also, such as your furniture, a car, and jewelry). There are other exemptions available that may apply to this settlement also.
California does allow certain exemptions to be declared to help protect some assets in a Bankruptcy filing. You are allowed to have a certain amount in your bank accounts; however, if your case is worth a high dollar value, then you will need to figure out what range your case is worth and what exemptions would be applicable.
