Can Trustee reopen Chapter 7 based on asset appreciation?
My case is one I have not read about anywhere and I have a lot of questions about the legality of it all, so I would greatly appreciate any help I can get.
I am a Plaintiff in the class action suit against Exxon Mobil for the 1989 oil spill, for which punitive damages are now being distributed. I filed Chapter 7 bankrupcy in which all debts were discharged in Feb. 2002. On the application future possible distributions were listed as $5,000 since no one knew at the time how much it would be, if anything.
The IRS was listed as a creditor towards a lien of approx. $53,000. Since an IRS levy had already been filed, the levy was re-filed by the IRS before the first levy expired, but only against future possible Exxon settlements.
The IRS now lists the debt at $94,000 and plans to enforce the levy against the impending distribution. The clincher is that the bankrupcy trustee has decided to reopen my case, I guess, due to appreciation of the value of punitive award. The amount awarded for me, (to be split with my ex-wife due to the divorce settlement) is supposed to be around $120,000, less the IRS levy of $94,000, which would leave about $25,000 for payment to creditors and taxes on the award, likely leaving us with $.00 or less.
Of course, this brings up many questions: First, is this all legal more than 7 years after the discharge of debt? Secondly, why would the trustee bother, since most other creditors have likely written off the debt and the IRS is supposed to get most of the money anyway? There won't likely be much left for anyone else. I had previously heard that the trustee had the "option" to reopen. Fourth, is this IRS action to "levy" against future possible assets only, 14 years after the tax was incurred, legal and justified?
My original BK atty. thinks I might have a case that the asset was abandoned, but is it really worth the expense of contesting this, as the IRS stands to get most of it. Right now I have little faith in this attorney's abilities as he could not answer these same questions I have posed here.
Further complicating this scenario, is the chance that we may get a future distribution of puntive damages, if the 9th Circuit Court allows for interest to be paid since 1995. Would the BK case then be reopened again, to rake off funds to pay any creditor that might be left?
We once thought we would get a lot more of an award, but the amount was decreased by the US Supreme Court, and so, many other fishermen are in the same pinch as I, likely to end up with nothing, 20 years after the damages and 15 years after the trial where ten times the current amount was awarded. Thus the answers to many of these questions might become important to many others.
I am a Plaintiff in the class action suit against Exxon Mobil for the 1989 oil spill, for which punitive damages are now being distributed. I filed Chapter 7 bankrupcy in which all debts were discharged in Feb. 2002. On the application future possible distributions were listed as $5,000 since no one knew at the time how much it would be, if anything.
The IRS was listed as a creditor towards a lien of approx. $53,000. Since an IRS levy had already been filed, the levy was re-filed by the IRS before the first levy expired, but only against future possible Exxon settlements.
The IRS now lists the debt at $94,000 and plans to enforce the levy against the impending distribution. The clincher is that the bankrupcy trustee has decided to reopen my case, I guess, due to appreciation of the value of punitive award. The amount awarded for me, (to be split with my ex-wife due to the divorce settlement) is supposed to be around $120,000, less the IRS levy of $94,000, which would leave about $25,000 for payment to creditors and taxes on the award, likely leaving us with $.00 or less.
Of course, this brings up many questions: First, is this all legal more than 7 years after the discharge of debt? Secondly, why would the trustee bother, since most other creditors have likely written off the debt and the IRS is supposed to get most of the money anyway? There won't likely be much left for anyone else. I had previously heard that the trustee had the "option" to reopen. Fourth, is this IRS action to "levy" against future possible assets only, 14 years after the tax was incurred, legal and justified?
My original BK atty. thinks I might have a case that the asset was abandoned, but is it really worth the expense of contesting this, as the IRS stands to get most of it. Right now I have little faith in this attorney's abilities as he could not answer these same questions I have posed here.
Further complicating this scenario, is the chance that we may get a future distribution of puntive damages, if the 9th Circuit Court allows for interest to be paid since 1995. Would the BK case then be reopened again, to rake off funds to pay any creditor that might be left?
We once thought we would get a lot more of an award, but the amount was decreased by the US Supreme Court, and so, many other fishermen are in the same pinch as I, likely to end up with nothing, 20 years after the damages and 15 years after the trial where ten times the current amount was awarded. Thus the answers to many of these questions might become important to many others.