Reopening a Closed Bankruptcy Case to Amend Schedules
This blog discusses a debtor who wishes to reopen a closed bankruptcy case in order to amend schedules.
Reopening Bankruptcy Cases to Claim Personal Injury Exemptions
The 10th Circuit Bankruptcy Appellate Panel recently considered when debtors could reopen closed cases in order to amend their schedules. See In re Mendoza, 595 B.R. 849 (B.A.P. 10th Cir., 2019). The Court looked at two cases where the debtors wanted to reopen their closed bankruptcy case in order to amend their schedules. In both cases the debtors failed to properly list their personal injury claims in their bankruptcy schedules. They received a bankruptcy discharge and their bankruptcy cases were closed. Later, they moved to reopen their cases so they could amend their schedules to list the personal injury claim as an asset and claim an exemption to the asset.
The Dollman case
Ms. Dolman suffered a personal injury in 2013 at a Walmart parking lot when she tripped over a shopping cart corral in disrepair. Later in 2013, her and her husband filed a Chapter 7 bankruptcy. They did not disclose the personal injury claim in the bankruptcy schedules. She received a bankruptcy discharge the same year. Two years later she filed a complaint against Walmart. Walmart’s attorney sought the dismissal of the complaint claiming Mrs. Dolman was not the holder of the personal injury claim. Walmart asserted the bankruptcy trustee was the holder because it was an asset of the bankruptcy estate.
The Mendoza case
Ms. Mendoza suffered a personal injury in 2014 as a result of being rear-ended in an automobile accident. In 2016 her and her husband filed a Chapter 7 bankruptcy. Like the case above, they did not disclose the personal injury claim in the bankruptcy schedules. She received a bankruptcy discharge the same year and her case was closed. Later the same year Ms. Mendoza received a settlement on her personal injury claim and disclosed it to her attorney, who disclosed it to the Chapter 7 Trustee. The Chapter 7 Trustee claimed the settlement was an asset of the bankruptcy estate.
The Court ruled the closing of the bankruptcy case did not preclude the debtors from later reopening their cases to amend their schedules to list the personal injury claim and claim the exemption. The case may be viewed at the following link:
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