breach of contract?

[jdphillips73]

Can I file bankruptcy?

My former employer is sueing me for not completing a 3 year employment contract as a nurse. They want 45,000.

Can I file bankruptcy even thou they have not received a judgement? Court trial is scheduled in early 2009? I would like to file now, my income is under the 6 month mean test for my state.

Thanks for any advice. I have talked to a couple of lawyers who say that I can file, but I have read online in legal settings where you cant file bankruptcy on a case where it isnt established as a debt yet.

help!

[justbroke]

That's considered an executory contract. It is dischargeable, and more appropriately.... rejectable!

You can file now, even without the Judgment. That's because they do have a claim, and you have a contract to reject. However, the contract must be unexpired.

I think that's going to be your issue. You can't reject a contract that doesn't exist -- which the Chapter 13 would allow you to do. However, you could schedule the debt and they can file a claim.

[jdphillips73]

My contract with them would expire in jan 2009. I am planning on filing dec 2008. Any problems here? And they are scheduled to get a judgement in early 2009, so if they do, i could still file chapter 7 right?

[justbroke]

My contract with them would expire in jan 2009. I am planning on filing dec 2008. Any problems here? And they are scheduled to get a judgement in early 2009, so if they do, i could still file chapter 7 right?

First, is your contract expired or terminated. These are two different scenarios. There has been some caselaw on whether a terminated contract is an "expired" contract, for purposes of the Bankruptcy Code.

Personally, I think it's easier to Reject an Unexpired Executory Contract (and employment contracts are definitely executory as they have performance characteristics)... over dealing with a claim and judgment.

If your contract is still in place in December, that sounds perfect! Of course, your lawyer has to file the Motion to Reject Executory Contract. The court will more than likely then issue an Order Directing Response to Motion. Contract/Lease Rejections are considered contested matters and are subject to other parts of the Bankruptcy Code.

Rather than make that seem all clandestine and scary... suffice it to say that a simple Motion to Reject, then a response by the other party... and then an Order allowing the rejection, is about it.

(I'm going through a similar motion, but on an Unexpired Lease. I just got the Order to Directing Response today).