Indiana Bankruptcy Lawyer in Columbus Shares Lessons from Court

February 28, 2012 2:30 pm Published by

There’s nothing like a true life story to get a point across, and that’s why this week I’m devoting all my Bankruptcy in Indiana articles to actual court cases as summarized in a recent issue of Consumer Bankruptcy News.

As part of providing Indiana bankruptcy information, I need to stress that exemptions make up a very, very important part of the new bankruptcy laws of Indiana. I know, because, back a number of years ago, I (as a longtime debt consolidation lawyer in Indiana) was called upon to help write that exemptions portion of the law in our state. When an asset is “exempted”, that means the debtor is allowed to keep it, and that resource does not need to go towards repaying creditors.

Well, in one Wisconsin bankruptcy case, an interesting question arose about an exemption.


  • A young woman named V. was injured in an auto accident. She suffered no permanent damage, and did not lose any wages.  However, she could not pay the medical expenses of more than $6,000.
  • While V. had filed a personal injury claim which she valued at $10,500, she could not be sure she’d ever get that award.
  • Meanwhile she was being harassed by her creditors, so V. decided to file personal bankruptcy under Chapter 13 bankruptcy law, five months after her accident.
  • The question before the bankruptcy court was whether the projected proceeds of the personal injury claim should be included in V’s projected disposable income (in figuring out how much she could afford to pay on her debt repayment plan.)
  • The court ruled in favor of allowing V. to proceed with filing individual bankruptcy.

My colleagues in the four Zuckerberg bankruptcy law offices understood the reasoning behind this decision, but I want to explain to readers of Bankruptcy in Indiana what this is all about.
Anyone seeking Indiana bankruptcy help must understand that the facts about one’s financial situation need to be set out in the bankruptcy paperwork.  All of the known facts must be included in that bankruptcy petition – what assets you have, what debts you owe, what money you have coming in from income or investments, or rentals – ALL income. The dispute here centered around whether V. $10,500 from the personal injury settlement should have been included.

In this case, though, as one of my Columbus bankruptcy lawyer colleagues pointed out, V. had applied for a settlement, but really had no way of knowing how much, if any, of that money she would actually receive.  That’s why the court did not penalize her for not including the settlement money.

Bankruptcy law, for both individual bankruptcy in Indiana and small business bankruptcy in Indiana, can be complex, but today’s highlighted “lesson from court” is rather simple:

It all centers around providing accurate, complete, and honest information to the bankruptcy trustee.  In fact, a very large part of the work I do in both bankruptcy Chapter 7 in Indiana and in cases like V.s involving Chapter 13 bankruptcy law, lies in gathering, organizing, and presenting facts!  Just the facts.  ALL the facts..



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This post was written by Mark Zuckerberg

1 Comment

  • Bankruptcy Attorney Doug A. Bernacchi says:

    Thank you for your Indiana Bankruptcy Blog and for referring me clients, as you have now for some years, in Northern Indiana. I know you are a professional consumer bankruptcy lawyer in Indianapolis, and I work hard to be responsive to my clients in South Bend, Elkhart, and Michigan City.