Chapter 13 and lawsuit

[captk]

Good Morning,
Thanks in advance for your help. I have been sued by Discover and Chase Bank.
My attorney has withdrawn due to an attorney, client disagreement. The attorney started arbitration without us discussing this and we decided the best course of action was for him to withdraw and I will retain a different attorney to file chapter 13.
The question is; how do I notify the court that I am preparing to file bankruptcy? The attorney that was hired to litigate is no more. How do I do this?

[despritfreya]

Telling someone you are going to file bk and actually filing bk are two different things. Until you file, creditors are free to collect and the state court lawsuit will move forward. There is nothing to tell the state court.

Once you file bk the protection of the automatic stay goes into effect and the lawsuit cannot proceed without the blessing of the bk court. Once the case is filed your bk attny will notify the state court and opposing counsel.

Des.

[captk]

Thank you for your answer.

[captk]

The reason I am asking this is that another case was voluntarily dismissed without prejudice when I notified them that I had retained an attorney to seek relief through bankruptcy.

[Carmella]

I am in Ohio and when we were sued it took a long time. We were able to respond and then there were pretrial, more than one pretrial for the same case. I just said I didn't know what we were going to do because of our finances. The creditor would try to settle with a payment amount I delayed, very indecisive, had to talk to husband. Now it sounds wishy-washy to think about what happened, but that was my mental state.

Once you do file almost immediately you get a letter from the court, some of my creditors dismissed without prejudice and others dismissed with prejudice.

I would not tell the creditor you are filing until you filed or your court date is within a few days.

The last pretrial I had was over the phone and this was before Covid. I told them I was going to file and the judge/magistrate was like OK and that was that.

[despritfreya]

The reason I am asking this is that another case was voluntarily dismissed without prejudice when I notified them that I had retained an attorney to seek relief through bankruptcy.

Personally, I would not have taken the step to dismiss - certainly, not on the word of a non-attny. Defendants sometimes misrepresent the truth.

If an attny for the defendant notified me that he/she was going to be filing a bk for the defendant, as a courtesy to the attny I would have given the defendant an extension of time to file an Answer or, if an Answer was filed, I would have not moved forward in the lawsuit. I would have put it on hold pending official notification of the bk filing within a short window of time - say 30 days. Upon such notification I would dismiss the suit. Why? Because, if I agreed to dismiss the suit and the defendant failed to file bk, my client would have to pay another filing fee to file a subsequent lawsuit. In addition, local rules may limit the number of times a plaintiff can dismiss a case and refile it.

Des.

[captk]

I did notify the court and Plaintiff's attorney, in that case, that I have retained an attorney to seek debt relief through bankruptcy. I would not ever try to scam the court or Plaintiff's attorney by claiming something that is not true.

[despritfreya]

. I would not ever try to scam the court or Plaintiff's attorney by claiming something that is not true.

Not saying you would, but it does happen.

Des.

[captk]

Des, I don't see how that could even happen. If a defendant told the plaintiff's attorney that they were filing bankruptcy, I would expect that the Plaintiff's attorney would seek verification. Without the retained attorney's name address and phone number, one would be a fool to attempt that scam. And, the 30-day, a short window of time, would, in my opinion, would not be enough time to get the entire filing procedure moving and filed.

[flashoflight]

I would not tell creditors with no pending lawsuits about the bankruptcy. If they catch wind of it, there may be a race to the courthouse and try to get a quick default judgment. A lot of people get depressed or can't pay the retainer to BK and that's extra time to sneak in a judgment and maybe even a judgment lien.

[justbroke]

Des, I don't see how that could even happen. If a defendant told the plaintiff's attorney that they were filing bankruptcy, I would expect that the Plaintiff's attorney would seek verification.

Some do, some don't. As Des wrote, a seasoned attorney could go on the word of the debtor's attorney (not the debtor themself) and pause the prosecution of the case. A seasoned attorney would wait to see if a case had actually been filed and follow up with the other attorney. Despite how one may feel about lawyers, attorneys have an ethical duty to be forthright... and it's not worth getting the reputation of being dishonest in the business.