Chapter 7 and a Lawsuit

[peppylady]

This is hard to explain. I hired an attorney and he ripped me off of 45,000.00. He ripped off over 170 clients all over the US. To make a long story short. He got arrested last week. In July I filed Chapter 7. I was honest with my bankruptcy attorney and told him about this other attorney and asked if he would file a suit against this attorney for malpractice. He then said that filing a lawsuit would get me out of backruptcy,. What does that mean? Does it mean my bankruptcy will be on hold until the lawsuit is over? I don't mind that at all. It will pay back my creditors but does it mean the bankruptcy comes to a hault until my lawsuit is over? I was suppose to give up my car whcih is paid for. Do I get to keep the car until the end now>

[JRScott]

In essence if you did win the lawsuit any award would become part of the bankruptcy estate.

As such the trustee would first use it to pay your debts and then assuming any is left after that and his fees you'd get the remainder.

[peppylady]

But the lawsuit could take at least a year. Will the bankruptcy come to a halt while I am sueing this character. Maybe I should wait until the BK is over. It should be discharged in about 6 weeks.

[ready2puke]

I would think if you waited you would have to wait at least 6 months. Not sure if thats right, but like an inheritance you would have to report it within 6 months...

[peppylady]

I will wait until I speak to the attorney. This character just got arrested and didn't even go to trial yet although very client has proof he ripped us off in a scam. I would rather pay my creditors off thru the bk but I am afraid that the trustee wouldn't fight hard enough for me. I am seeking punitive damages too. This is a legal malpractice lawsuit.

[keepmine]

Since you had a cause of action within 180 days of filing bk, that lawsuit will be part of the bk estate. You can get discharged but, the trustee won't close the case until then outcome is determined.
You're right, the trustee won't fight for you at all. In fact, the mal pratice carrier will contact the trustee and offer to settle for the amount it'll take to pay off your creditors. Your trustee will accept it and that'll end the litigation.

[peppylady]

Maybe I could go after punitive damages after the case is over What do you think>

[epiphany]

I am no attorney but my take on it is this:

It means that your chapter 7 will go kaput if you file a lawsuit now because now you are anticipating an award.

However, you can't count on any money from this guy even if you do get a judgment unless you know the guy has that money to pay you, which seems doubtful. And maybe you'll have to wait in line behind 170 people??

People that rip off 100's tend to blow the money quickly but who knows.

Hell, he may even file BK himself.

My take is, if you pursue now, you are headed for MUCH headache and delay.
Get your discharge and then pursue.

IMO,
ep

[peppylady]

the guy does have money he has over 8.8 million in stock. He has no malpractoce insturance. But i think the trustee knows about this and he might start litigation. But my attorney says I could easily persuade the trustee to let my attorney handle it, Then I could get punitive damages with an outside attorney don't you agree?