Bankruptcy & Lawsuits

The Law Offices of Damian M. Nolan can help
you with your  Chapter 7 bankruptcy filing.
Call our offices at (562) 634-1115 today!

If you’ve recently been threatened with a lawsuit or someone has already filed suit against you, you may be considering bankruptcy protection. Most people have many questions when someone files suit against them. Many of those questions are general to the lawsuit, such as:

Should you answer the complaint?

What happens if the other party gets a judgment against you?

What happens if you ignore the lawsuit?

Some questions are specific to bankruptcy, such as: Can bankruptcy stop a garnishment for the judgment?

If the complaint goes unanswered, the court presumes that you agree with it. In most cases, you should answer the complaint. Doing nothing means that the court will, more than likely, award the plaintiff what he or she asks for or prove damages. Not answering the complaint most likely means that you won’t be a participant in the hearing. If the plaintiff wins a judgment against you, he or she can get a lien against your assets to recover damages, garnish your wages, or levy your bank accounts. Negotiating payments may be possible in some cases.

A bankruptcy petition shouldn’t be based on the timeline of the lawsuit, as weeks or months can pass between you being served notice of a lawsuit and the plaintiff getting a judgment against you.

In a bankruptcy, the judgment will probably be dischargeable, regardless. If, however, the judgment is attached to some asset, the only way to avoid it is if the attachment to the asset impairs an exemption in bankruptcy. If you have a judgment against you and your wages are being garnished, a bankruptcy filing will stop the garnishments on any income earned after the date of the bankruptcy filing. The only judgment against you that cannot and will not be discharged are orders for support.

California Court Forms & Fees

In the majority of cases, there are fees to file paperwork with the court system. The fees can vary depending on the county, but most counties have their fees posted on their web sites. Here are links to those web sites for use (the links will open in a new window or tab).

Los Angeles
Orange
Riverside
San Bernardino
San Diego

There are cases – such for a Domestic Violence restraining order – there are no fees associated with filing. Low income filers may not have to pay fees, but there are forms to fill out to get a fee waiver.

Description	Fillable Form	Instructions
Order on Application for Waiver of Court Fees and Costs	982(a)(18)	Instructions for form 982(a)(18)
Application for Waiver of Court Fees and Costs	982(a)(17) (form does calculations)	Instructions for form 982(a)(17)

If you decide to apply for a fee waiver later in your case, you will need these forms:

Description	Fillable Form
Order on Application for Waiver of Additional Court Fees and Costs	982(a)(18.1)
Application for Waiver of Additional Court Fees and Costs	982(a)(20)

Please note that these forms are for the court only and should not be served on the other party.

Debunking the Top 8 Bankruptcy Myths

The Law Offices of Damian M. Nolan can help you with your
Chapter 7 bankruptcy questions and concerns.
Call (562) 634-1115 for a free, no-obligation consultation today,
and get advice from the best!

Myth #1: Bankruptcy is no longer available for most people.

Answer:  Though the 2005 Bankruptcy Amendments have made the process of filing and getting a bankruptcy more complicated, bankruptcy protection is still available to almost everyone.

Myth #2: If you file for bankruptcy, the government will seize everything you own.

Answer: Since most bankruptcy cases are considered “no asset” cases – meaning that everything the bankruptcy petitioner owns is exempt from seizure and sale – it’s absolutely untrue that your property will be seized. In fact, some pensions and other assets are not considered part of the bankruptcy estate.

Myth #3: Married couples must file for bankruptcy protection together.

Answer: Though married couples can file for bankruptcy together, they are not required to.

Myth #4: If you have a job, you cannot file for bankruptcy protection.

Answer: The 2005 Amendments to the bankruptcy code instituted a “means test” which may prohibit some filers with steady income from filing for bankruptcy under Chapter 7, but this does not mean every person with a job cannot file for bankruptcy. An experienced bankruptcy lawyer can help you find out if you will be eligible under the means test to file for bankruptcy.

Myth #5: Your credit will be ruined for 10 years if you file for bankruptcy.

Answer: Although a bankruptcy remains on your credit report for 10 years, recent bankruptcy petitioners are regularly deluged with offers for credit. These offers generally have low limits and high interest rates, credit agencies often target recent filers because they cannot file for bankruptcy again for several years.

Myth #6: Medical bills cannot be discharged in bankruptcy.

Answer: Although collection agencies like to tell this story to those who owe medical debt, the truth is that, if the medical bills are unsecured debt (which most are), you can be almost certain that the medical debt will be discharged in bankruptcy.

Myth #7: Your debt has to be of a certain amount before you can file for bankruptcy.

Answer: Bankruptcy laws have no set minimum of debt required before filing. It’s really as simple as this: if you can’t pay what you owe, bankruptcy may be a viable solution for your situation.

Myth #8: Society will consider you a failure if you file for bankruptcy.

Answer: Whether a person is considering bankruptcy or not, the vast majority of people want to pay back what they owe. When debt is overwhelming and situations such as job loss, illnesses, death of a spouse, or other circumstances prevent a person from living a normal life and paying back the debt, sometimes bankruptcy is the best course of action.