Personal Bankruptcy Ex Wife Filed Bankruptcy and Debt Related question

[mrdivorcee]

My ex-wife decided to not pay her portion of jointly held debt as required on the Property Settlement Agreement. She has now since declared bankruptcy and did not list me as a co-debtor on a $16K charge off but instead listed her current spouse as a co-debtor. I was never informed of the bankruptcy by her attorney but found out later. This is has adversely affected my credit report and my inability to refinance, etc. I'm not sure if there are any options at this point but wanted to find out about fraudulent information on a bankruptcy document or how to remove these from my credit report. I know I can pay her debt and then sue and file a judgement. Is there any recourse for her using false information on a bankruptcy document and not informing me as a co-debtor? I have several lates and charge offs on my report that were assigned to her but never taken care of. Any insight or help would be appreciated.

 

[army judge]

My ex-wife decided to not pay her portion of jointly held debt as required on the Property Settlement Agreement. She has now since declared bankruptcy and did not list me as a co-debtor on a $16K charge off but instead listed her current spouse as a co-debtor. I was never informed of the bankruptcy by her attorney but found out later. This is has adversely affected my credit report and my inability to refinance, etc. I'm not sure if there are any options at this point but wanted to find out about fraudulent information on a bankruptcy document or how to remove these from my credit report. I know I can pay her debt and then sue and file a judgement. Is there any recourse for her using false information on a bankruptcy document and not informing me as a co-debtor? I have several lates and charge offs on my report that were assigned to her but never taken care of. Any insight or help would be appreciated.

I suggest you discuss the entire matter with your divorce attorney.

By the way, you and her are divorced.

She can't add you to her bankruptcy.

If the federal court approves her BK, then there might be no remedy for you, except to file your own BK.

Again, discuss the matter with your divorce attorney.

What, no divorce attorney?

Then, you might wish to see a general attorney or a bankruptcy attorney.

Good luck.

 

[Proserpina]

My ex-wife decided to not pay her portion of jointly held debt as required on the Property Settlement Agreement. She has now since declared bankruptcy and did not list me as a co-debtor on a $16K charge off but instead listed her current spouse as a co-debtor.

She doesn't really have much choice there - if they're declaring bankrtupcy together, he IS the co-debtor. That doesn't mean you don't owe - it's basically what the BK court requires.

I was never informed of the bankruptcy by her attorney but found out later. This is has adversely affected my credit report and my inability to refinance, etc. I'm not sure if there are any options at this point but wanted to find out about fraudulent information on a bankruptcy document or how to remove these from my credit report. I know I can pay her debt and then sue and file a judgement. Is there any recourse for her using false information on a bankruptcy document and not informing me as a co-debtor? I have several lates and charge offs on my report that were assigned to her but never taken care of. Any insight or help would be appreciated.

She didn't use false information - you cannot file jointly with her anyway, and she did the legally correct thing to do. Believe it or not, she also has no legal duty whatsoever to inform you - you're not part of the bankruptcy.

I'm sorry, but if you had joint debts they're now your sole responsibility.

 

[Proserpina]

Can you clarify how you think you can sue her for reimbursement? If they are joint debts, they belong to both of you - not just you, not just her.

 

[despritfreya]

Can you clarify how you think you can sue her for reimbursement?

Assuming the ex filed a Chapter 7 and the divorce decree required her to pay certain marital obligations, if OP is called upon to pay those obligations by the creditor then he can sue the ex for recoupment/reimbursement. Nothing arising out of a divorce decree is dischargeable in a Chapter 7. See 11 USC 523(a)(5) for support related claims and see 11 USC 523(a)(15) for all other divorce related claims.

If the ex filed a Chapter 13, the property settlement of the divorce decree is subject to discharge. However, the bk court can independently determine if what is classified as a property settlement is "in the nature of support" and, if it is, it is not dischargeable.

OP, as mentioned above, you are not a co-debtor filing the bk. Joint cases can only be filed by married (not divorced) couples. Your ex should have listed you on Schedule H. In addition, since you are a potential creditor you should have been listed on Schedule F and the master mailing matrix. However, since you know about the bk, it no longer really matters. Please consult with a bk attny relative to your rights under 11 USC 523 and bk in general.

Des.

 

[Proserpina]

The problem with the OP's situation is that at least in the Western District, the court has a tendency to make a clear distinction between support obligations and separation debts. But even if we can somehow cross our fingers and wish really really hard, OP isn't really going to get much of a break regardless.

Let's pretend that by some minor miracle, she has to withdraw or amend based upon the debt. Well, what then? Mom's first move is going to be running down to family court pleading poverty and asking for the divorce to be reopened and the property disposition amended...in her favor. That's a distinct possibility.

Now let's pretend that in addition, she can't reopen the divorce. Now what? He goes to court for an OSC? She might get fined. But she's not going to jail and it still leaves him in the same financial mess because with no income (which I expect will be the claim) he's really got nothing to take. If she's not working, he can't take what she doesn't have and her husband is absolutely not going to be responsible.

And now for the meat. OP needs to answer whether or not his decree has ANY verbiage with regards to future bankruptcy, or a "hold harmless" clause.

Des, I know you know your stuff. And I know I'm not an expert. But this one is not nearly as black and white as it may appear.

OP is getting screwed, I don't like it, but he needs to know other options.

 

[despritfreya]

Proserpina,

Please note the following (1-3 are drawn from OP's posts and 4-5 are from yours):

1. My ex-wife decided to not pay her portion of jointly held debt as required on the Property Settlement Agreement.

Covered by 11 USC 523(a)(15) if she filed a 7 or 11. In a 13, is subject to discharge unless Bk Court determines this requirement was in the "nature of support". This protects the ex spouse, not the actual creditor. Ex who filed bk will have to reimburse the ex who did not if the creditor seeks payment from him.

Please note. . . Washington is a community property state. Debts incurred during the marriage are the responsibility of both parties regardless of who signed on the dotted line and regardless of what the divorce decree says. There are a few exceptions to this rule but. . . you get the picture.

2. I was never informed of the bankruptcy by her attorney but found out later.

Actual/constructive knowledge of bk means bound by bk regardless of whether or not party was officially on the mailing matrix.

3. I know I can pay her debt and then sue and file a judgement.

Technically correct although not artfully worded. If OP is called upon to pay the obligation then he can recover from ex if ex filed the Chapter 7 or 11 but not if she filed a 13. To seek recovery when dealing with a 13 OP must get a separate determination that the obligation to pay was in the "nature of support".

4. The problem with the OP's situation is that at least in the Western District, the court has a tendency to make a clear distinction between support obligations and separation debts.

Not an issue if the ex filed a 7 or 11 since it does not matter if the obligation is support or property settlement. Neither is dischargeable. It is only an issue if the ex filed a 13. I did not see that OP mentioned which Chapter she filed.

5. OP needs to answer whether or not his decree has ANY verbiage with regards to future bankruptcy, or a "hold harmless" clause.

Again, not relevant. If the Decree assigned marital debt to the ex and, due to her bk, the underlying creditor can no longer go after her, but, instead, goes after OP and OP pays, OP has the right to recover his loss from the ex - or at least try - if the ex filed a 7 or 11.

You are correct that going after the ex may be dumb if the ex has nothing to give and no future non-exempt assets. When push comes to shove, OP's best solution may very well be filing his own bk and. . . such is the advice I give many in this type of situation. OP needs to consult with a bk attny. That does not mean he should not consult with a DR attny as well but, a DR attny is most likely not going to have the expertise to advise him of the benefits of 523(a)(15) unless he/she is well versed in both areas of the legal field.


Des.

 

[Proserpina]

Fair enough - can't argue with that