Bloomington Bankruptcy Attorney Knows It Depends on the Situation

December 8, 2012 11:10 pm Published by

Every good bankruptcy attorney who works in the Zuckerberg bankruptcy law offices knows Indiana bankruptcy law.  At the same time, all of us know that, as I’m always reminding readers, IT DEPENDS. In other words, each client who files personal bankruptcy in Indiana  has a different situation.  Bankruptcy courts look not only to the letter of the law, but to what’s actually going on with each individual. This week in my Bankruptcy in Indiana articles, I’m focusing on three different actual cases.  Each illustrates how important it is to visit with an experienced bankruptcy lawyer early in the process, so that there will be time to discuss each of the details and to properly prepare the bankruptcy petition.

One of the Bloomington bankruptcy lawyers read about an interesting case in Nebraska where Mr. & Mrs. K. filed under Chapter 13 bankruptcy law

  • The debtor-wife had suffered heart damage due to the use of a diet drug and had needed aortic valve replacement surgery.
     
  • The wife had been awarded a settlement of $495,000. (At the time of the personal bankruptcy filing, the amount of the settlement was not yet known.)  

Now, there are two general bankruptcy rules in play here:

1. Personal injury claims are generally exempt from creditors in other states, but not in Indiana.  (I helped write the exemptions portion of the new bankruptcy laws of Indiana.)

2. Whenever there has been a substantial change in circumstances, the debtors must report that change to the bankruptcy trustee, and the bankruptcy court has the right to modify the Chapter 13 plan in light of the new circumstances.

 Now the court did not change the rule about the money being exempt from creditors’ claims.
Instead, the court modified the Chapter 13 plan to allow some of the proceeds to fund the plan.
As we discussed this case, one of my Columbus bankruptcy lawyer colleagues focused on the fact that, even though money was needed for the debtor-wife’s ongoing medical care, she did have health insurance through her employer.

In other words, whether it happens in another state or has to do with bankruptcy in Indiana,
no bankruptcy case is cut and dried.
  Over my 26+ year legal career, that’s one aspect I’ve come to appreciate more and more. I try to reflect that long experience in very accurate, precise paperwork, the court knows it can rely on the preparatory documentation done through our office.

 The other factor this case brings to mind is that a very large percentage of individual bankruptcies in Indiana are rooted in medical costs. And, even though a large settlement was forthcoming, and even though there was employer health insurance, the clients still needed to cover a portion of the expenses out of pocket, which created the financial hardship leading to the bankruptcy.

Knowing that the court is going to be considering each client’s unique set of circumstances, we use our work in preparing and submitting accurate and on-time paperwork as the key to success. That’s why all of us – the, Bloomington, Anderson, Indianapolis, Richmond, and Columbus bankruptcy lawyers spend so much of our time doing paperwork, filling in all the blanks, making sure all the information is presented fairly and correctly.

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This post was written by Mark Zuckerberg

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