Help, I’m Getting Sued After My Bankruptcy
It’s not a regularity, but it does happen. Sometimes, a creditor files a lawsuit on debt that was discharged in your Chapter 7 Bankruptcy. In most instances, this isn’t suppose to happen! You’re not supposed to be sued after bankruptcy on discharged debt!
Can I Still Be Sued After Bankruptcy?
NO! Unless one of the few exceptions applies, the law states clearly that a discharge in bankruptcy operates as an injunction against the commencement or continuation of an action, the employment of process, or an act, to collect, recover or offset any such debt as a personal liability of the debtor, whether or not discharge of such debt is waived. This language can specifically be found in 11 U.S.C. 524(2).
What does this Mean?
It means that once you receive a discharge in Bankruptcy, that discharge is final unless you execute and file a valid reaffirmation agreement. It also means the debt is dead, gone, kaput, deceased, over, and NO, you cannot now be sued on it unless one of the few exceptions applies, which they rarely do, and you’d know about it.
How can this happen?
Sometimes the creditor simply didn’t get the message, and didn’t know of the discharge in your bankruptcy. Generally, in these instances, as soon as learning of such, they’ll dismiss the new case against you immediately, and apologize.
Other times, they are just plain wrong, and very ill advised for not following the law, and it can cost them dearly. Recently, the Court sanctioned a collections attorney in the United States Bankruptcy Court for the Eastern District of Missouri for continuing to sue a debtor here in St. Charles County over a debt that had been discharged 2 years prior in the Federal Bankruptcy Court. The Federal Judge in St. Louis called the violation the second most egregious violation he had seen during his time of the bench. The collections attorney had ignored numerous notices/warnings from both the debtor, and the debtor’s attorney, both written and verbal, as well as filed documents in the underlying state lawsuit, and continued to institute the illegal lawsuit in clear violation of the discharge injunction under the federal bankruptcy law.
Bottom line: If you are being sued following a bankruptcy on debt that existed before the bankruptcy was filed, more than likely the suit is wrongful. It may be an honest mistake that a simple phone call can resolve, and it may be clearly illegal in which case you should put that bully in it’s place. Consult a bankruptcy attorney today to learn your options.
By: Guss Markwell
O’Fallon, MO 63366
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