Pickering

Oct 30, 2014

OUTCOME: After argument, the Court reopened the case and allowed the Debtor wife (as the husband had passed away) to amend the bankruptcy schedules to list the underlying personal injury action and to claim an exemption.

Debtors failed to disclose a potential settlement from a personal injury action (asbestos exposure caused malignant mesothelioma). The bankruptcy case was closed prior to the disclosure. The debtors ... did not realize until after they sued for the injury that the failure to disclose the potential cause of action could be fatal to their personal injury case. My firm filed an action and a brief asserting illness and excusable neglect as a reason for the failure to disclose and seeking permission to amend the bankruptcy schedules. This remedy is extraordinary relief as typically once a bankruptcy is closed, you are precluded from retroactively amending to add assets and claim exemptions.