If the you file suit against the person and they file for bankruptcy protection they may not have to answer the lawsuit. They can file a suggestion of bankruptcy in your lawsuit which will most likely stop the lawsuit until the bankruptcy is over or when you obtain relief from the bankruptcy stay. You have to ask the bankruptcy court for relief from stay before you can continue with the lawsuit.
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I agree with Mr. Chen. The bankruptcy proceeding will stay your case for sometime. Speak to a bankruptcy attorney in South Florida.
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Section 362 of the U.S. Bankruptcy Code imposes an automatic stay at the moment of the bankruptcy filing. So, if the bankruptcy is filed before you file the case or during the period in which the defendant is required to answer, the case will be stayed and there will be no obligation to answer. The majority of lawsuits such as yours are then discharged at the end of the bankruptcy. But, there are exceptions under sections 523 and 727 of the bankruptcy code, generally under the umbrella of conduct by the debtor that was intended to hinder, delay or defraud or other specific actions seen generally as fraud. My suggestion: have a litigation attorney review the facts of your case to apply these concepts. Meanwhile, here is a link to an article on bankruptcy basics: [Blue Link Below]
Law Offices of Andrew D. Myers, North Andover, MA & Derry, NH provide answers for informational purposes only. Actual legal advice can only be given by an attorney licensed in your jurisdiction, thoroughly familiar with the area of the law in which your concern lies. This creates no attorney-client relationship.
If the you have sued someone who subsequently files for bankruptcy, they do not need to answer your complaint. Your lawsuit will be subject to the automatic stay pursuant to section 362 of the bankruptcy code. In order to procede with your suit is to get relief from the automatic stay by filing a motion with the bankruptcy court, which the court may or may not grant. Depending on the pre-bankruptcy behavior and relationship with this Debtor you may have a basis file an adversary against the Debtor under sections 532 or 727 of the bankruptcy code. Note, if you have not yet sued this person and they file for bankruptcy before you get a chance to file a complaint, you cannot sue them other than in the bankruptcy context mentioned above. You should speak to a bankruptcy attorney to determine what rights you may have in the bankruptcy context, there are plenty of great bankruptcy attorneys in the south Florida area.
If it is a legitimate bankruptcy and you are named as a potential creditor the lawsuit will be stayed until the bankruptcy court discharges the debt. Consider consulting a local attorney because there are certain circumstances where he will not be able to discharge the suit for instance if you are alleging fraud. Here is a list of debts that can't be discharged under chapter 7 of the bankruptcy code:
Taxes and tax liens
Alimony and child support (domestic support obligations)
Debts obtained through fraud, false pretenses or false representation
Debts you failed to schedule in time to allow creditors to file proofs of claim (unscheduled debts)
Debts for fraud while you were acting in a fiduciary capacity, or for embezzlement or larceny
Debts for willful and malicious injury
Debts for fines or penalties to governmental units
Debts for judgments in wrongful death or personal injury lawsuits resulting from motor vehicle, vessel or aircraft accidents while you were intoxicated
Condominium or cooperative association fees or assessments
If your case involves a personal injury claim and the other person has insurance coverage, you may be able to file for relief from the bankruptcy automatic stay to the extent of the insurance coverage that's available. It's recommended that you speak with an attorney to discuss your case.