Personal Bankruptcy Filing Chapter 13 w/a countsuit are we protected

[rutnbuck]

We are trying to drop our lawsuit which has a countersuit from the other party, but we are going to file chapter 13 instead before this all goes to court, will we be protected if the other party doesn't drop their countersuit and we should lose (we would name them in the filing of chapter 13 as a creditor).

 

[Michael Wechsler]

Dropping your lawsuit does not mean that a countersuit based on the lawsuit is automatically dropped. That will continue until its end as if it were its own lawsuit. Regarding Chapter 13 bankruptcy, the law is clear as to what is covered and what is not. The defendant might challenge your Chapter 13 filing as well. You're not automatically protected from anything just by filing for bankruptcy. You'll have to proceed in Bankruptcy Court. Also note that transfers within 90 days of filing for bankruptcy will also usually be in question. You may want to speak to a lawyer before filing.