Cell Phone Contract listed on Schedule G

[JCCarroll]

What is the name of your state? Utah

I am dealing with Cingular trying to charge me early termination fees after filing for Chapter 7 and listing the 2 year contract in the Scedule G form. It was my understanding that listing the contract in Schedule G voids the contract and would prohibit them from chargin an early termination fee. Am I wrong?

[azatty]

Schedule G debts are not automatically "voided." Schedule G discloses executory contracts and unexpired leases. What technically *should* happen after filing the bankruptcy petition is a motion to assume or reject the executory contract/unexpired lease under 11 U.S.C. §365. In a rejection scenario, the provider would be entitled to charge the termination fee, although it would be considered a pre-petition debt and discharged as a general unsecured claim.

If you're keeping the cell phone, list it on Schedule G (it will still be an executory contract). If you're not keeping the phone, list it on Schedule F (general unsecured claims), and stop using the phone before you file (terminated contract). To avoid the hassle of the executory contract, just put it on Sched. F.

Now, the creditor still retains a right of setoff, so if you have a deposit with Cingular, they could set it off against what you owe them.