Is a post petition case of action lawsuit settlement part of a Ch. 13 bankruptcy estate? 9 Answers as of October 12, 2012

After filing for bankruptcy in the state of Kentucky, I was involved in a situation where I filed a lawsuit against another party (cause of action was 7 months after filing for Ch. 13 bankruptcy). With 1 year left in my bankruptcy plan, the lawsuit settled out of court. Is the settlement part of the bankruptcy estate, or is it mine since it happened after the bankruptcy filing?

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LAW OFFICE OF MARGARET L. EVANS, PC
LAW OFFICE OF MARGARET L. EVANS, PC | Margaret L. Evans
Question: Is a post petition case of action lawsuit settlement part of a Ch. 13 bankruptcy estate? Question Detail: After filing for bankruptcy in the state of Kentucky, I was involved in a situation where I filed a lawsuit against another party (cause of action was 7 months after filing for Ch. 13 bankruptcy). With 1 year left in my bankruptcy plan, the lawsuit settled out of court. Is the settlement part of the bankruptcy estate, or is it mine since it happened after the bankruptcy filing? *- YES, absolutely it is part of the bankruptcy estate, but to what extent depends on the nature of the claim and the characterization of the settlement proceeds. *
Answer Applies to: South Carolina
Replied: 10/12/2012
Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
Under section 541 of the bankruptcy code, it belongs to the bankruptcy estate.
Answer Applies to: California
Replied: 10/12/2012
Law Office of Norman Moore
Law Office of Norman Moore | Norman P Moore Jr
This sounds suspiciously familiar. When you file a Chapter 13, the trustee gets information about your income and about your expenses. He then decides what you need to live (he subtracts expenses from income). All money leftover is "disposable" income and he expects you to pay it to him. I suspect your repayment plan contains language to that effect. If it does, you must pay, no matter where the money came from.
Answer Applies to: Wisconsin
Replied: 10/12/2012
Stephens Gourley & Bywater | David A. Stephens
It is probably yours unless you plan provided otherwise.
Answer Applies to: Nevada
Replied: 10/11/2012
Balena Law Firm
Balena Law Firm | William Balena
Your question lacks important details. You indicate the cause of action was seven months after filing a chapter 13. Does that mean you filed the suit seven months after filing? Or does that mean the incident giving rise to your claim for damages occurred seven months after you file a Chapter 13 case?
Answer Applies to: Ohio
Replied: 10/10/2012
    William Bidwell, Attorney at Law | Bill Bidwell
    Earnings and property acquired post petition/post confirmation but pre termination are property of the bankruptcy estate. There may be exceptions for settlements arising from a personal injury lawsuit.
    Answer Applies to: Michigan
    Replied: 10/10/2012
    Diefer Law Group, P.C.
    Diefer Law Group, P.C. | Abel Fernandez
    The lawsuit is not part of the bankruptcy estate. However, the income you get from the lawsuit might be an issue.Most trustees require that you pay into the plan windfall monies you receive such as tax returns if you are doing anything less than a 100% plan. You should speak with your attorney.
    Answer Applies to: California
    Replied: 10/10/2012
    Dan Wilson Bankruptcy
    Dan Wilson Bankruptcy | Dan Wilson
    The answer to your question is surprisingly unclear. It also probably differs depending on practice of Ch 13 trustee in your jurisdiction. I recently dealt with a related question involving an inheritance. MHO a settlement this long after confirmation is not part of the Ch 13 estate, but you should seek an opinion from a lawyer who has dealt with this issue.
    Answer Applies to: Colorado
    Replied: 10/11/2012
    Law Office of Stuart M. Nachbar, P.C.
    Law Office of Stuart M. Nachbar, P.C. | Stuart M. Nachbar
    As you are in a C13, it is part of the estate. Your counsel should be attempting to determine if there is a way to exempt the proceeds from the lawsuit, and file the appropriate amended schedules.
    Answer Applies to: New Jersey
    Replied: 10/10/2012
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