Q: What if my debtor already went bankrupt, can you still enforce my judgment?

A: We are judgment brokers, not lawyers and nothing we say, write, or put on a web site is legal advice. See a lawyer if you need legal advice. See our Finding The Right Lawyer article, and our National Lawyer State Bar List, and our Your Judgment and Bankruptcy article.

If you were sent a Proof Of Claim form and you did nothing with it – then sorry – probably nothing can be done. If it was a “no asset” bankruptcy – again sorry – nothing can be done.

If the debtor filed for bankruptcy, but had (or has) lots of assets, and did not list you as a creditor – then there is a chance of enforcing the judgment. Re-opening a closed bankruptcy case is expensive.

I am not a lawyer, however I know that not being listed in the judgment debtor’s BK schedules, is not the same thing as the debt being incurred post bankruptcy. The date the debt was incurred is critical, not the judgment date.

Isn’t the debtor supposed to list all their creditors? Yes, the debtor is supposed to list all their creditors including themselves, their lawyer, and their spouse. Very often the debtor forgets to list one or more creditors (sometimes forgetting on purpose).

The debtors (sometimes after the creditor reminds them or the court) were often going back to the court, after the bankruptcy was discharged (meaning the bankruptcy is over) to re-open their case to add a creditor they forgot to list.

The courts decided this was taking up too much of their time and resources. The different Circuits (regional area bankruptcy courts) starting writing opinions (rules) that applied just to their Circuit. The opinion that most Circuits have adopted is:

In a Chapter 7 No-Asset case that has been discharged, all of the debtor’s regular pre-filing debts, before the bankruptcy filing, are discharged whether they are listed or not. (This means regular debts, not “exception” debts: tax liens, student loans, family support, reproven fraud judgments). Of course, if the debtor is really poor, there is not much reason to add yourself as a creditor.

The 4th, 9th, and 11th Circuits have adopted this ruling. Other circuits have also. We have not researched this fully but one exception is the 1st Circuit. They have adopted the view that if a creditor was not listed (meaning they were not notified of the bankruptcy) then they did not have the opportunity to challenge the debtor in court, therefore the debt is NOT discharged. (We wish it was like that in all places.) It is important to know how your local Circuit stands on this issue. In a Chapter 13 bankruptcy, when a judgment creditor is not noticed, it is more likely that their claim will not be subject to the bankruptcy discharge of debts. Consult with a lawyer.

The two dates that you need to be concerned with are the date that the bankruptcy petition was filed, and the “cause of action” date that lead to the judgment. The “cause of action” date is important to determine if the judgment is eligible to be included in the bankruptcy. If the cause of action was after the bankruptcy filing date, the judgment is usually good.