Q: will be discharged, but not closed

[Zapata]

Okay, I understand the difference. My trustee said that I will be discharged next week (yay!!!), but that the case won't be closed because he is investigating whether any assets are recoverable under a trust for which I am a beneficiary.

Now, someone has to die before I the trust will then change to distribute some money to me as a beneficiary.

My question is...so, that person has not died. How long can the court keep my case 'open'? I mean, could they literally keep it open for a couple of years "waiting for this guy to die"?

Or rather, let's say the court keeps my case open for 6 months... closes it... and a year from now, let's say the guy dies, and it is ripe to distribute the money to me. Do I get to keep that money?????

Oh, the trustee said that the key to the trust (on whether the assets would be available for him to take) was whether or not there was a 'spendthrift' provision in the trust. Anyone heard of this term before?

[Zapata]

Answered my own question re the spendthrift trust.

it is defined as:


Spendthrift Trusts Bankruptcy law acknowleges that "spendthrift trusts" (a trust formed to protect the beneficaries from creditor claims) are not subject to the claims of creditors in bankruptcy. Generally, if a spendthrift trust is set up for education or retirement planning, it is exempted from the estate of a bankrupt individual. However, a debtor in bankruptcy cannot create a spendthrift trust to protect himself from creditors -- a so-called "self-settled spendthrift trust."

I am very certain that the trust is not set up like that. My parent would not have had the foresight to do that...

So, I guess I have the original question... if the money isn't really MINE till X person dies, and that person has not died... and doesn't die in the next year... surely the court can't essentially put a lien on that money for when it does become mine, right? Or, rather, isn't the whole point that the bk court pretty much gets whatever assets are in existence at the time of filing??

[bkfiler]

well i didnt even get to read your post yet but great to see you found an answer.

without reading it closely, just want to point out that whoever setup a trust for your parents might have known many things and guided them. veryify what you need to verify before it matters.

[Zapata]

well i didnt even get to read your post yet but great to see you found an answer.

without reading it closely, just want to point out that whoever setup a trust for your parents might have known many things and guided them. veryify what you need to verify before it matters.

I hope you come back! LOL I had two questions.

The first I am not sure about... how long can they keep the bk open. I mean, can they keep it open 'waiting for someone to die'? Cause the money isn't mine till this person dies. In the extreme, if I die before this other guy dies, for example, that money wouldn't go to my descendants. It would go to the other 4 beneficiaries equally. In short... the money isn't rightfully mine unless and until that other person (who lives off the interest till he dies, btw) dies. Technically, I can't consider what I may receive as mine unless and until this one guy dies. Can't assign my proceeds... nothing.

So, I can't imagine the bk court can actually hold my case open 'waiting in the event X person dies' and the money becoming inheritable to me.

[Zapata]

I should add... that I paid an attorney for a consultation after I filed to make sure my ducks were in a row and that I understood all of this stuff before the First Meeting. I get there....and they made me meet with a legal asst... who was knowledgeable... but was NOT a member of the bar... and said a lot of times..'I am not sure, we need to ask the attorney and get back to you.' As I wrote out my check to them... I was ired to say the least. When I made the appt, it was an appt with the attorney, dang it.

Later, I called them to ask one more question. "Oh, you will need to make another appt 'with the atty' and of course pay for another hour."

Just ranting.... pisses me off that I paid an attorney to get a few key answers relevant to my bk.....but never did get to speak to an atty.

And the legal asst darn sure never asked the atty some of the questions she couldn't answer and get back to me.....

Arrgggh.

[SinkingFast]

I don't know how long the Trustee can keep your case open. May depend on what he/she finds in the investigation.

If your parent is younger, in good health, not likely to kick off soon, the Trustee may give up and close your case.

If your parent is older, with a deteriorating condition, indicating death may be likely some time soon, the Trustee may hold your case open a while.

How the inheritance is structured may be a factor as well. Will you get a huge cash pay-out, or will the money be tied up in some way.

The Trustee can get money from you for windfalls up to 180 days after BK in a Chap 7. Windfalls like inheritance, lottery winnings, etc. At least that's what one attny told us.

Last I knew, Minny's (MinnyMouth) case was discharged but not closed. She thinks the Trustee is waiting for her to sue some people. If Minny wins, the Trustee cashes in on her windfall.

[Zapata]

I don't know how long the Trustee can keep your case open. May depend on what he/she finds in the investigation.

If your parent is younger, in good health, not likely to kick off soon, the Trustee may give up and close your case.

If your parent is older, with a deteriorating condition, indicating death may be likely some time soon, the Trustee may hold your case open a while.

How the inheritance is structured may be a factor as well. Will you get a huge cash pay-out, or will the money be tied up in some way.

The Trustee can get money from you for windfalls up to 180 days after BK in a Chap 7. Windfalls like inheritance, lottery winnings, etc. At least that's what one attny told us.


Last I knew, Minny's (MinnyMouth) case was discharged but not closed. She thinks the Trustee is waiting for her to sue some people. If Minny wins, the Trustee cashes in on her windfall.

ah, now that makes sense. The trustee may find the conditions of the parent promising (for that parent! lol)... and give up.

Thing is, I have no idea what his condition his (it's not a parent... just the lifemate of my parent....). He's like 68.. and never did live a very healthy life. And my family? Tons of acrimony, so no one talks to each other ... so who knows what the lifemate's health situation is. And he is such a jerk.. he's probably kill himself just to make sure I didn't get the money.

And it would be a lump sum payout... probably in the neighborhood of exactly what my debts are, in fact. Which is a drag.... cause I will get discharged... and then ALL my debts could get paid 100%. So, I get the bk on my record AND I pay all my debts 100%. Double loss, imo. I was *hoping* the trustee would find the money available well before discharge (cause the trustee won't tell me ditty about the parent's condition; he could be DEAD right now as far as I know!). And if I could have learned from the trustee that the money was available, I would have quickly dismissed the bk.... found a way to get the money and MADE A DEAL to pay a portion of the debt to the creditors. And have maybe $20,000 for ME to buy a piece of land so I can live in peace and security.

But nooooo, the trustee didn't make an inquiry to the trustee until a week before the discharge was due... so I won't be able to dismiss the bk if the money is available.

gosh (sarcasm), you don't the trustee foresaw such a plan on my part and made sure he let the clock run out before inquiring? Naaaaa.. he wouldn't do that to ensure a good $20,000 payment for himself? No way. That would be opportunistic. arrrrgh.

[Badgerz]

well i didnt even get to read your post yet....

without reading it closely, just want to point out that whoever setup a trust for your parents might have known many things and guided them.

BK, buddy, I've been reading these forums for quite awhile but just started posting recently with a few questions. One thing I've noticed is that you're developing a tendency to not read entire posts before replying to them. This practice could be dangerous, especially here while advising people on what to do. Now this doesn't necessarily pertain to this particular thread as all you did here was not read the OP's posts. (He doesn't think the trust includes the Spendthrift thingy.)

No harm no foul, but please be careful. I know that 3,000 post mark is looming on the horizon and I know you're free and clear now with your own BK but maybe slow down a tad, LOL.