objection to discharge chapter 7

[Walkker]

What is the name of your state (only U.S. law)? Michigan

A friend of mine was involved in a collision recently which resulted in about $1000 worth of damage to her vehicle. Since the driver responsible was driving without insurance she sued him in small claims court and was awarded the $1000 claim. He has since filed for Chapter 7 bankruptcy.

My understanding is that since this was a court ordered debt it cannot be discharged. 11 U.S. Code § 523 19(B)iii seems to state it is exempt from discharge . The law I'm citing says "A discharge under section 727, 1141, 1228(a), 1228(b), or 1328(b) of this title does not discharge an individual debtor from any debt that results, before, on, or after the date on which the petition was filed, from any court or administrative order for any damages, fine, penalty, citation, restitutionary payment, disgorgement payment, attorney fee, cost, or other payment owed by the debtor."

I am no attorney though, so I was hoping that someone could tell me if I'm reading that correctly and if her awarded claim is exempt from discharge.

Also, would she need file a complaint, or a motion, regarding this? Apparently filing a complaint costs around $300, so if this is incorrect I don't want to see her waste her money or the court's time. If it is a complaint, would that approx. $300 be added to his debt to her or is that just the cost of doing business, so to speak.

I appreciate any guidance anyone could give me regarding this issue. She's a hard working single mother and the cost of repairing her vehicle caused a serious burden. Since she followed the rules and pursued this in the correct manner I'd hate to see her just lose that money because of someone else' irresponsible behavior.

Thanks in advance for any assistance provided.

 

[quincy]

What is the name of your state (only U.S. law)? Michigan

A friend of mine was involved in a collision recently which resulted in about $1000 worth of damage to her vehicle. Since the driver responsible was driving without insurance she sued him in small claims court and was awarded the $1000 claim. He has since filed for Chapter 7 bankruptcy.

My understanding is that since this was a court ordered debt it cannot be discharged. 11 U.S. Code § 523 19(B)iii seems to state it is exempt from discharge . The law I'm citing says "A discharge under section 727, 1141, 1228(a), 1228(b), or 1328(b) of this title does not discharge an individual debtor from any debt that results, before, on, or after the date on which the petition was filed, from any court or administrative order for any damages, fine, penalty, citation, restitutionary payment, disgorgement payment, attorney fee, cost, or other payment owed by the debtor."

I am no attorney though, so I was hoping that someone could tell me if I'm reading that correctly and if her awarded claim is exempt from discharge.

Also, would she need file a complaint, or a motion, regarding this? Apparently filing a complaint costs around $300, so if this is incorrect I don't want to see her waste her money or the court's time. If it is a complaint, would that approx. $300 be added to his debt to her or is that just the cost of doing business, so to speak.

I appreciate any guidance anyone could give me regarding this issue. She's a hard working single mother and the cost of repairing her vehicle caused a serious burden. Since she followed the rules and pursued this in the correct manner I'd hate to see her just lose that money because of someone else' irresponsible behavior.

Thanks in advance for any assistance provided.

You do not appear to know the whole story. Michigan is a no-fault state. If your friend is insured, her insurance company covers the damages to her car.

 

[adjusterjack]

My understanding is that since this was a court ordered debt it cannot be discharged. 11 U.S. Code § 523 19(B)iii seems to state it is exempt from discharge . The law I'm citing says "A discharge under section 727, 1141, 1228(a), 1228(b), or 1328(b) of this title does not discharge an individual debtor from any debt that results, before, on, or after the date on which the petition was filed, from any court or administrative order for any damages, fine, penalty, citation, restitutionary payment, disgorgement payment, attorney fee, cost, or other payment owed by the debtor."

I believe that's not the right section.

Try (B)(i) any judgment, order, consent order, or decree entered in any Federal or State judicial or administrative proceeding;

https://www.law.cornell.edu/uscode/text/11/523

I thought judgments were generally dischargeable so I can't guarantee that the interpretation is correct. Federal law is almost incomprehensible.

I think there is a bankruptcy specialist that participates here. Check back and see if there are any other responses.

 

[Walkker]

You do not appear to know the whole story. Michigan is a no-fault state. If your friend is insured, her insurance company covers the damages to her car.

I am well aware Michigan is a no fault state. However, since the other driver was not insured at all (which he was ticketed for and found guilty of) and she only had PL/PD insurance on her vehicle, the court found that driver to be responsible for the damages and has already awarded her the cost of repairs. I believe she was awarded her claim because the 'no fault' laws only apply if all drivers involved in the incident are insured. Regardless of the 'no fault' laws, she has already been rewarded the claim in court so any discussion of that aspect is irrelevant at this point.

 

[Walkker]

I believe that's not the right section.

Try (B)(i) any judgment, order, consent order, or decree entered in any Federal or State judicial or administrative proceeding;

https://www.law.cornell.edu/uscode/text/11/523

I thought judgments were generally dischargeable so I can't guarantee that the interpretation is correct. Federal law is almost incomprehensible.

I think there is a bankruptcy specialist that participates here. Check back and see if there are any other responses.

Thanks for your input. I'll definitely keep checking back.

 

[quincy]

I am well aware Michigan is a no fault state. However, since the other driver was not insured at all (which he was ticketed for and found guilty of) and she only had PL/PD insurance on her vehicle, the court found that driver to be responsible for the damages and has already awarded her the cost of repairs. I believe she was awarded her claim because the 'no fault' laws only apply if all drivers involved in the incident are insured. Regardless of the 'no fault' laws, she has already been rewarded the claim in court so any discussion of that aspect is irrelevant at this point.

Actually, it is not "irrelevant." You apparently misunderstood your friend because what you describe did not happen in Michigan because of Michigan no-fault laws. No fault applies whether one driver is uninsured or not. If your friend was insured, her insurer takes car of auto damage.

Whatever the case, here is a link to In Re Felski, 277 B.R. 732 (E.D.Mich.2002), on discharging an auto accident judgment in bankruptcy: http://law.justia.com/cases/federal/district-courts/BR/277/732/1964471

 

[justalayman]

I am well aware Michigan is a no fault state. However, since the other driver was not insured at all (which he was ticketed for and found guilty of) and she only had PL/PD insurance on her vehicle, the court found that driver to be responsible for the damages and has already awarded her the cost of repairs. I believe she was awarded her claim because the 'no fault' laws only apply if all drivers involved in the incident are insured. Regardless of the 'no fault' laws, she has already been rewarded the claim in court so any discussion of that aspect is irrelevant at this point.

Actually in this case the at fault driver could be held liable for 100% of the damages caused. Michigan allows for a "mini tort" action of up to $1000 of non insurance covered damages when the at fault party has insurance. Not having the legally required insurance removes the protections of the law. Was the total of the damages only the $1000?

 

[CTU]

Actually, it is not "irrelevant." You apparently misunderstood your friend because what you describe did not happen in Michigan because of Michigan no-fault laws. No fault applies whether one driver is uninsured or not. If your friend was insured, her insurer takes car of auto damage.

Whatever the case, here is a link to In Re Felski, 277 B.R. 732 (E.D.Mich.2002), on discharging an auto accident judgment in bankruptcy: http://law.justia.com/cases/federal/district-courts/BR/277/732/1964471

In that case DUI was also an issue (which does complicate things somewhat); would it still hold for the OP's friends case?

 

[justalayman]

Actually, it is not "irrelevant." You apparently misunderstood your friend because what you describe did not happen in Michigan because of Michigan no-fault laws. No fault applies whether one driver is uninsured or not. If your friend was insured, her insurer takes car of auto damage.

Whatever the case, here is a link to In Re Felski, 277 B.R. 732 (E.D.Mich.2002), on discharging an auto accident judgment in bankruptcy: http://law.justia.com/cases/federal/district-courts/BR/277/732/1964471

Quincy, the not at fault party only had pl/PD insurance (no collision coverage). That means there is no insurance to cover their damages BUT the law removes the protections of the mini tort limitation if the at fault party does not carry the legally required minimum insurance.

 

[despritfreya]

Rewriting the pertinent question without all of the extra stuff. . .

A friend of mine was involved in a collision. . . and obtained a judgment for property damage against the other driver. . . The other driver has since filed for Chapter 7 bankruptcy. My understanding is that since this was a court ordered debt it cannot be discharged based upon 11 U.S. Code § 523 19(B)iii. Is that correct. . .

Not correct. 523(a)(19) has to do with securities law.

Judgments for property damage are generally dischargeable. To be non-dischargeable one would have to prove that the damage was the result of willful & malicious conduct under 523(a)(6). What you describe does not remotely come close to meeting such a burden.

Des.