Avoid being sued before filing

[moses911]

Just an update that we got served yesterday summon and complaint just by the time we are filing this week for chapter 13.
I know that we have 21 days to answer. But have few questions

a) If we are filling this week do we need to answer at all?
b) If we file how will the court know we filed and they don't obtain a default judgement?
c) What happen to pending law suit like this in Chapter 13 do they expire at all and the debt collector have to refile summon and complaint if chapter 13 get dismissed?

[justbroke]

a) If we are filling this week do we need to answer at all?

No, you would not need to , per se, answer the complaint.

b) If we file how will the court know we filed and they don't obtain a default judgement?

Depending on your particular local non-bankruptcy court, you may need to file a Suggestion of Bankruptcy, or its equivalent, in the jurisdiction in which the lawsuit has been filed. You will also want to contact the law firm that filed the suit and provide them with the notice of bankruptcy. Your notice of bankruptcy will be automatically sent to that creditor/law firm if you listed an appropriate address in your Mailing Matrix. This creditor should certainly be scheduled in your filing, but you may also want to add the address for the law firm, itself, in the Mailing Matrix.

c) What happen to pending law suit like this in Chapter 13 do they expire at all and the debt collector have to refile summon and complaint if chapter 13 get dismissed?

They can file a claim. They must withdraw the lawsuit because they can't proceed with the lawsuit. If your Chapter 13 fails, then they can refile, but the statute of limitations (SOL) is still running during the Chapter 13. (There is a 30-day door for them if the SOL expires before the Chapter 13 is dismissed. The 30-day door allows them to refile within 30-days of that dismissal, otherwise the SOL will be an offense to any new lawsuit.)

You may want to inform your attorney about all this and ask if they'll send a letter to the "opposing" attorney regarding the filing of the bankruptcy. Your attorney may charge you for that, or do it for free.

[moses911]

I met with my attorney and provided him the explanation. He told me not to worry about it.
What I found out also that in my district the trustee will ONLY allow wage order deduction. Now I'm so stressed as my employer will find out and I work for a very small company.
I'm afraid that I will get fired and then I will not be able to pay.

[justbroke]

They can't fire you for the sole reason that you filed bankruptcy or have a wage deduction order. Depending on your State's laws, they many only be able to fire you for cause. As for the deduction, this is no different than having a child support deduction order or similar deductions by court order.

[moses911]

thanks for taking the time to explain everything for me. You are awesome.
So when when an employer receive a wage deduction order can they tell if it was from a bankruptcy or child support etc... OR will it be just a general deduction wage order?

[justbroke]

When an employer receives the wage deduction order, it will clearly read, at the top of the order, UNITED STATES BANKRUPTCY COURT. It will include the court division, case number, judge and likely the Trustee's name. It will include the amount from which to deduct from after tax wages, where to send it, and for the duration (typically indefinite until order of the court or by the Trustee).

There's no hiding it. I had a "voluntary" IRS wage order so that I could pay the IRS under a payment agreement. Never doing that again. I worked in a large company and it was slightly unnerving to receive an intra-company email from the company's General Counsel informing me of the receive of the IRS wage order. Plus, it showed up on every paycheck, so when I went to buy a car, the financing people asked what the IRS Wage Order deduction was all about. (They thought it was a tax lien. No, it was a voluntary deduction albeit hard to explain.)

Simply put, if your District requires a wage deduction order, so be it. In my District and others, the District Chapter 13 Trustees allow you to sign up for an ACH withdrawal instead (direct from your bank). That way your company would not know.

At least that's my story, and I'm sticking with it.

[moses911]

Ya that is very awful. The company i work for is very small. Will they inform my manager as well? Do any think I should tell HR or should i just wait until they find out?

Anyone experienced this before?

[newlife13]

I have not experienced this, but due to the nature of my work and clients, I'd probably lose my job for a bankruptcy. I think my situation is unique, though.

If I were you, I'd approach HR once you have all the info (when payments will start, how much, etc.) and let the HR person know that you are in a repayment plan through the U.S. Bankruptcy Court and you agreed to a wage order. I also would ask that he respect your privacy and not inform your direct manager. If they are decent people, they probably will tell the CFO but not your manager.

Sorry you're going through this. Good luck.