Consequences of not naming a creditor as a liability

June 28th, 2006 by Questions

Good Day,
I am owed monies by a bankrupt person. The bankruptcy did not name me or the debt owed to me as a liability. I have a court order (Small Claims) that was obtained two months before the person went bankrupt.
Can I still collect this debt?


One Response to “Consequences of not naming a creditor as a liability”

, Barton Goth, GCO Inc. Bankruptcy Trustees said:

The way the law works is that your debt is essentially cleared, regardless of whether or not you were listed on the bankruptcy documents. The only monies you are potentially entitled to would be your pro rata share of any dividends that may be paid out of the bankruptcy estate. If you were notified, or sent in a proof of claim, you will get those monies when the individual is discharged from the bankruptcy. However, if you do not file a proof of claim, you will not receive any distributions from the estate but still have the right to be paid your pro rata share and can collect that amount from debtor directly. As a result of this you are not able to make collection attempt on the debt, but potentially could make collection attempt on the dividend amount should the debtor fail to notify you of the proceeding or should you fail to provide a proof of claim.

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