I have asked this question before and got several different answers. Here is the question again however with an additional question. In 2004 my wife was part of a class action lawsuit. In 2009 my wife and I filed chapter 13. We disclosed the lawsuit in the BK. The BK was discharged and closed in May 2013. The lawsuit was settled 3 months after the closing of the BK. My original question was can the trustee reopen the BK. This is where I got several different answers. Some of you say yes and others say no or maybe. The attorney handling the lawsuit will not release the any funds to us until a determination is made by the trustee in reopening the case. It has been over 6 months since the settlement was completed. Is there a time frame the trustee has to make a decision to reopen the case .
Was the asset exempt? If it was listed and exempt then no reason to reopen. If it was listed but not exempted then your plan should have said something about it - what does the plan say? Have you spoken to your lawyer? If you do have one you should get one to help you sort it out. That may get things moving.
You must look at the Schedule B and C . Was it exempted in full and listed?
Secondly, what does the chapter 13 plan provide, with respect to the asset of the lawsuit recovery, whether it was part of the estate or not and contributed into the plan or not.
Thirdly, if you disclosed it is one thing, but did you list it in Schedule B and C or not?
Fourth, employ an experienced ch 7 and 13 bankruptcy attorney who has practiced this are of law full time 100% for many years in your state..many may exist right here on AVVO in fact. They can assist you in this matter! If not exempted, it may possibly be part of your bankruptcy estate forever until listed and exempted too. Good luck and have a great Thursday!
You will have to take your papers to a ch 13 bk attorney who can review them and advise you accordingly. The attorney in the best position to help you is the one who handled your bankruptcy case.
If your Chapter 13 case was confirmed and later discharged, it stands to reason the Chapter 13 Trustee has abandoned your assets (provided that the asset, here the lawsuit, was listed on your bankruptcy schedule of assets).
Generally confirmation means the property of the estate reverts back to the Debtor. However, property acquired during a Chapter 13 must be reported to the Chapter 13 Trustee to fund your plan if there are no available exemptions, for example a tax refund or if the lawsuit proceeds were received while the Chapter 13 was pending, or winning the lottery.
It seems to me, that the Trustee has abandoned your asset - the case closed and the asset was never administered, but there's always a loop-hole.
The real question here is whether the lawsuit should be considered under the windfall rule of property acquired within 180 days of discharge, which if it is, the Trustee must be notified. Examples of financial windfalls include but are not limited to winning the lottery, receiving an inheritance, and a property settlement agreement with a spouse. Your bankruptcy attorney will have to look at the lawsuit award and see if it falls under the windfall rule, if so, then see if any exemptions apply.
Your litigation attorney has no obligation to keep the check in his or her possession pending this determination. There is no pending automatic stay or any bankruptcy duty to protect assets of the estate.
Contact your bankruptcy attorney and force the issue. If they are not responsive, find another one who has more experience who is able to make the best arguments on your behalf. Good luck!
This answer is for informational purposes only and is not legal advice regarding your question and does not establish an attorney-client relationship.
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