Forgot to include ex-wife as joint applicant

[mindblown]

Here is the detailed version ...need knowledgeable feedback fast.


My ex wife and I filed for divorce in 1999. We had no community property as we had a pre nup.... we had 1 joint loan both listed as applicants to a local bank. In my state you have to be seperated 6 months before you can get a divorce. Prior to the 6 months we came to an agreement (consent judgment) on child support custody etc and cancelled the pending court date. In this consent judgment it says that I will be solely responsible for the joint loan to the bank. We then reconciled about 3 weeks after the consent judgment was signed never going through with the divorce or making it final. I can prove we reconciled by the birth of our child subsequent to the consent judgment being filed with all time lines for a normal child birth proving a reconcilliation.

We then split up again 18 months after the consent judgment was filed. She filed it as new procedings as the previous proceedings as a matter of law were considered abadoned. In the new petition for divorce she admits we had been living together and by her act of filing clearly shows that she abadoned the previous proceedings as we were in the same court house but before a different judge as the case had been randomly alloted again due to the new filing. A property partition was never filed as we had a pre nup. the divorce became final in 2001.

The creditor who we had a joint loan with filed for a judgment and got it agaisnt both of us. She has been to three different courts and appeals court arguing all kind of things to try to get out of the debt and not once in those prceedings did she raise the issue that I assumed the debt also lending proof to the fact that she assumed as I did that the agreement was null and void as the original procedings as an operation of law had been abandoned.


I filed ch 7 in 10/05 under the old laws. I was discharged a few months later with the case being closed on 1/07. I had a tax return as assests so the assessts wee cash only. The creditor that we both owed money to filed a proof of claim to reduce the judgment if any funds were paid out.

My attorney for the bankruptcy said that we did not need to list my ex in my schedule so she did not list her. I can prove that in 2006 before my bankruptcy case closed her attorney representing her in the state court against the bank we owed money to in civil proceedings to cancel the judgment introduced as an exhibit at trial paperwork showing my proof of claim form from the bankruptcy proceedings provong they had knowledge even if not officialy served.

Now here we are today I was just informed by my divorce attorney that my ex has exhausted all of her avenues agaisnt the bank and has lost them all. She now has filed a motion for contempt agaisnt me in the divorce proceedings for failure to live up to the judgment where i agreed to be responsible for the loan. Her problem is the judgment is not in the current court we filed in and has no authority over that judgment. My divorce attorney is quite confident that the judgment where that agreement was made is null and void as we reconcilled and by laws of the state the judgment would have been extinguished. If she claims that it was a form of amending the pre nup as allowed by law she would still lose as you cannot agree to something that isnt allowed by law and the creditor rights agaisnt both of us are still protected.

The issue is I forgot to list her as a creditor in my shedule. Wheile I realize this is an asset case she would not have received anything as the creditor in which we both owed filed a proof of claim for the same debt. Therefore the judgment in which she still owes has already been reduced because of the claim that was filed on the assets. So therefore including her will not result in any harm to her as it will nto change the outcome.

The question is Im coming up on 3 years since I filed for the ch 7. Should I reopen the case to include her and if so will it be a problem considering the circumstances? I would feel safer if this base was covered but do not need to open a can of worms.

[JRScott]

My understanding of the old laws are not perfect.

I am not 100% sure but I believe it would have been discharged then. I know today you can take your discharge letter and have a judgment vacated. I'm not sure about then though.

If you previously filed with a lawyer and they are still in business you might call and ask about it.

Otherwise hopefully someone more knowledgeable comes by.

[HHM]

I am surprised you Ex would have wasted so much time fighting the judgment, that issue is a no brainer. Short of the bank releasing her from the loan, she is liable and no divorce decree or consent judgment is going to change that. That question is a no brainer. Until the judgment is paid IN FULL, she remains liablie for that debt to the creditor. You filed BK, so the debt is discharged as to you, but until the judgment is either paid in full or she file BK, she remains liable.

Now, she does have recourse to you...if the consent judgment (or divorce decree) says you will be the responsible party, she can drag you into family court and force you to pay the judgment on her behalf.

As of today, based on the situation you described.
Ex-wife is still liable to the creditor on this debt;
You are liable to your Ex-wife on this debt;
But, You are NOT liable to this creditor (because of your BK).

[Tbornetun]

If the 1st final judgement was never completed, (you stated that it was signed but was if filed with the court and did the judge sign off on the order attached to it? if not, it is as if that judgement doesn't exist.), then the 2nd judgment and decree would be the "official" one. She may not be able to come after you for anything.
Bottom line, as HHM stated, you are not liable to this creditor, she is though.

[mindblown]

well the 1st decree judge signed off on but state laws says that judgment is extinguished by the fact we reconcilled......so yes her claim of contempt in family court is grasping at straws as there is no existing order requiring me to do anything as it was cancled by the reconcilliation..


me and the attorney are no longer on speaking terms as i had to file a complaint with the bar assoc b/c of other mistakes such as this one.

the ex first attempted to claim inproper service and thought she could nullify the judgment ..we represented herself for part of it and then hired an atty.

[Tbornetun]

Then I wouldn't worry about it. Good luck to you.

[mindblown]

ok advice from an atty i got was dont do anything ...let the state court dismiss the claim of contempt ....if they find me in contempt and validate the judgment then they will issue my punishment but by the "letter of the law" the atty says her judgment that has me agreeing to pay it is null and void b/c we reconciled by her own admissions in the new divorce proceedings............ He said he suspects the previous judgment will be detemrined to be void and that will leave her only avenue of recourse against me to go back to bankruptcy court and have the case reopened. He said to do this she would have to say that in some way she was harmed by being left out. The creditor that has a judgment against us has already been dimissed in the bankruptcy court as it pertains to me and already had that judgment reduced on assestts (funds) that were disubursed to creditors with them being one of them as they filed the proof of claim. Therefore even if she had been listed her only recourse would have been to file a proof of claim to have the judgment reduced if the original creditor had not. Turns out they filed it anyway and regardless of if she filed it or they filed it the same debt was reduced at the same amount as it would have been regardless of who filed the proof of claim.

In the end she has no harm by being left out of the debt and therefore has no cause of action to bring a suit in the bankruptcy court. He said even if she did we would then file a motion to include her and show that a) she was aware that the bankruptcy prior to the deadline to file the proof of claim by evidence her attorney submitted in court and took no action. b) The judgment in state court was found to be invalid. c) she was/is not harmed by being included as the debt has already been reduced when the funds were disbersed to creditors from the assetts in the case.


So it seems slam dunk and she is grasping at straws. My attorney said he is going to ask for atty fees and sanctions for the improper filing. I will keep you posted and if anyone has feedback please input.

[2Bshinyandnew]

How much of the original loan is still outstanding, after your assets had been distributed? How much of this loan that you both agreed by "consent judgment" you would be solely responsible for, which is now null and void due to your temporary reconciliation? What agreement, if any did you come to regarding the responsibility of this loan in your final divorce judgment? Was some other equitable distribution arrangement agreed to that made her at least partly responsible for this loan that you originally agreed to be 100% responsible for?

How has she not been harmed if she now has to pay anything at all on a loan that you apparently agreed to be solely responsible for at one time?

Unless there was some other offsets in the final divorce judgment, she may have a case against you in family court. Your attorney can ask for sanctions, but asking ain't getting and they always ask.

[mindblown]

there were so many creditors that the judgment was reduced by very little as they were only dividing about 4,000 total. It is now at about 10,000.00 To be perfectly clear we made the loan to pay her credit cards that she had ran up prior to us even dating. So in all honesty the debt was hers but she couldnt get a loan which is why I had to be a joint applicant. So technically 100% of the debt was hers and used to consoldaite her credit card bills incurred pre relationship.

Our final judgment did not address community property as both sides acknowledged that that we had a pre nup. So therefore there was no community property addressed. The way it worked was she handled the bills we had a joint checking account and stopped paying all the bills including the loans to stock pile cash. We filed new proceedings and a final judgment of divorce was granted.

I said it above but will make it clear again that the judgment she is attempting to enforce was in proceeding that were cancelled. While you may consider the reconcilliation "temporary" you have to consider the following timeline.
11/96 started dating
1/98 married
2/99 separated 1st time
5/99 consent judgment on debt
6/99 reconciled
11/00 separated again
6/01 final judgment of divorce

So in the 17 or so months was actually the longest stretch of the marriage or relationship not the temporary reconciliation you assume it to be. This was not a long term thing at all and in that 17 months we had another child so it was not like she moved in for 2 days and split again.

You are correct we made a deal that involved: child support at 0 other then maintaining health insurance and food and clothing expenses where she provided a list of what was needed on a weekly basis, shared custody/domiciliary on a 50-50 basis, as a side agreement I gave her a car that was mine and paid for as she did not have one so that was all in the deal that we made. The deal by law was cancelled when we did not go through with the divorce in this proceedings as no final judgment of divorce was sought in that case. To say that judgment is valid and she is now hamred then you would have to take the whole deal not just part of it. She got her money to pay the debt in the form of misleading the cout about added expenses to the normal child support figures and temp spousal support. I certainly could not maintain the previous agreement as I would not have assumed the responsibility of the debt unless it was a package deal as there would have been no way to afford all of it. Technically, if the judgment is upheld then I will turn around and file a motion for contempt on the same basis and claim all of the funds that have been paid to her that she waived under the same agreement which is about 10 times the money to pay the judgment off is my harm on the same issue.

The direct answer to your question as to how she is not harmed? We were both responsible then it was just me by agreement that is not binding on the creditor. A petition for divorce in my state is cancelled automaticlaly upon reconciliation or when judgment for divorce is not filed within 2 years of the original request. Law requires that the community be reestablished if there is a reconciliation during the mandatory separation time (17 months or 10 mins). Law also says that any judments made during the separation become null and void if there is a reconciliation. The fact we had another child and the new divorce proceedings she admits we had reconciled. So whether the agreement was cancelled because of law or another agreement between us both assuming responsilbility is of no matter as that is what is required. To say she is harmed now was her own choice as she moved back in and should have stayed away if that was the deal she wanted...its the same for me ....I should have taken the deal and stayed away and got screwed in the long run b/c the good deal I made was cancelled by allowing her to come back..............

I said it before and I will say it again here ..I have no problem at all living up to the agreement ..I will pay 100% of the judgment as long as the entire judgment is enforced not just the part that is conveinient to her. I'll even cut a deal ...I will only request 50,000 of the over 100,000 paid in support since she didnt live up to the same judgment.

This is no different then a spouse being sued for a community debt they was not aware of b/c the other one went backrupt. Sucks but you are still liable under the law.

[2Bshinyandnew]

I understand a bit better. I'm going through a divorce myself right now and it is very difficult to reduce matters if the heart to law, litigation procedures, and numbers. It is the only system we have. My soon to be ex is filing for BK7 and there is quite a bit of joint debt, and I am being "forced" into filing a BK7 petition on my own. I have to wait 90 days since I used credit cards (in my own name) recently, and I was pretty "mindblown" when I found out that this was going to be his next move.

I'm OK with it now, especially thanks to this forum and understanding that BK will give my ex and I a fresh start. We actually went to a BK consult together to see if a joint petition would be better at this point (it won't be) Much of our disputes the past two years are over who will be responsible for the debt.

Best of luck to you.

[mindblown]

understandable ......hope all works out for you