Legal Question in Bankruptcy in Virginia

Settlement from a law suit

A friend of mine has recently filed for bankruptcy. However, 2 days later she received a letter about a 2 year long law suit against a hospital, saying they have settled out of court, and she has been awarded $10,000. If the bankruptcy has already been filed, and the money will not be handed over immediately, does she have to inform her debtors of this money or does a settlement by chance, fall under any exemption? Or perhaps if the money is not awarded until after the two month window for creditors to appeal, is this allowable or legal?


Asked on 10/04/05, 12:40 pm

1 Answer from Attorneys
Daniel Press Chung & Press, P.C.

Re: Settlement from a law suit

She needs to amend her bankruptcy schedules to list it, and exempt it if she can (her bankruptcy lawyer should be able to advise if some or all of it is subject to a claim of exemption). If she does not do that, she risks denial of her discharge, and will not be able to exempt the asset.

Read more
Answered on 10/04/05, 12:49 pm


Related Questions & Answers

More Bankruptcy Law questions and answers in Virginia