Examples of Bad Faith filings

[Jengo]

I've had my 341 meeting which went well, although a creditor showed up. The 341 has been left open just in case I need to go back for more questioning. My attorney afterwards told me that he thought it went well and basically not to worry about it. But my mind just keeps going. There is one creditor that is just very very nasty. They've alleged a number of issues in a motion that they've filed which some were taken care of or cleared up at the 341 meeting. I've posted about this elsewhere and don't want to go into the details of that post again.

This is the question that I have:

What are examples of bad faith for filing bankruptcy and the timing of the filing? They are alleging that I filed for BK at the commencement of their lawsuit to get judgment for their fees, etc.

This nasty creditor is trying to say that I filed my bankruptcy in bad faith and the timing of the filing and that it interfered and hindered with their lawsuit, etc. They included a few attachments in their motion, two being from before the filing of their lawsuit stating that I couldn't pay, etc., and that I was in financial dire straits. I also took the pre bk course on Jan 19th, two weeks before they filed their lawsuit. I know this aspect I can prove and knew I had to file or was preparing for BK before they started their suit. I've been searching the internet for examples of what is considered bad faith and haven't found much.

I do expect an objection from them while I'm in the 60 day window, although my attorney said he doesn't expect to hear anything from him and his huffing and puffing and that this creditor was stupid, even the TT laughed at him at my meeting. Their debt is unsecured and I know it can be kinda expensive for a creditor to start an adversarial proceeding in hopes that there may be a settlement which even if there is a settlement for substantially less I can't do it financially. I do not have a set income. I am a 1099 so my income varies all the time. This creditor is claiming that I owe him 45,000. If he does start an adversarial proceeding, I will fight it and will do what I can to fund it.

They're attempting to allege a judicial estoppel issue which is insane and what they're trying to say in that prior declaration that I signed from almost 6 months ago and can be explained as it was a snap shot of my life at that time and what the family was going through.

If my TT laughed at him and the TT did the slap down with stupid creditors like this guy as my attorney said, is this an indication of what a judge may do in reviewing what they're alleging? Also can the judge review the tape recording of the 341 meeting before making a determination of starting further proceedings, etc? My TT said in a very irritated voice and directed at the creditor that he would leave the 341 meeting open just in case he has to "drag" everyone back for further questioning.

I don't know. I know I shouldn't worry about this but this creditor is really nasty. Since funding for him is an issue and his knowing that he may have to fork out 2,000 or 4,000 for an adversarial proceeding that this may be a deterrent for him and his objecting to discharge. His fees that he is claiming are definitely dischargable as they are legal fees from a prior lawsuit that was withdrawn and even the TT when he heard that they were legal fees and the creditor was protesting it, the TT seemed extremely surprised at it.

I don't know. I just hope there's no objections from him but can't help to expect one because this guy wants some type of payment. Is there certain types of criteria that needs to be met by a creditor before they can initiate an AP?

[helpmeout]

I timed my filing to happen the day before I got a $4K bonus. Doesn't mean that I filed in bad faith.

As to the timing of your filing, that is irrelevant. You are not the only one who filed before a judgement could be ordered by a judge. That particular creditor is grasping at straws.

What is going to determine if you filed in bad faith is the facts of your filing. If you disclosed everything, listed all assets, income and debt and didn't lie on any of your schedules, then you did not file in bad faith. Again, that particular creditor is grasping at straws and attempting to drive up your legal fees for the bankruptcy filing. I would discuss the possibility of sanctions with your attorney. Because a creditor who fights a claim in bad faith (and it appears this one is) can be ordered to pay your legal fees for fighting that action.

[justbroke]

The whole purpose of declaring bankruptcy, is to stop all collection and judgments... by definition! There is no way your petition was filed in bad faith. Bad faith has a specific definition and usually it's where you manipulated the petition, not the creditors!

Bad faith is usually related to the nature of your debt, eve of bankruptcy charges, actual fraud, serial filings, hidden assets, etc.

[ejhamilton]

justbroke is completely right. Tons of people file bankruptcy because they have a potential suit looming over their head. We'll be one of them.

Doesn't matter how "nasty" they are, they are quite stupid on top of all that "nasty." They are trying to scare you, and obviously the Trustee thought it was hilarious that they think they have a chance, that should tell you enough right there.

Just breathe.

[bobbyquefour]

justbroke is completely right. Tons of people file bankruptcy because they have a potential suit looming over their head. We'll be one of them.

Doesn't matter how "nasty" they are, they are quite stupid on top of all that "nasty." They are trying to scare you, and obviously the Trustee thought it was hilarious that they think they have a chance, that should tell you enough right there.

Just breathe.

LOVE your response, esp the first sentence.

[Jengo]

Thank you for the responses. Yes, I agree that they are quite stupid and that yes, they are attempting to scare me to get their way or attempt to get my BK dismissed or investigated for fraud, etc., which there is nothing there. I looked at my schedules more thoroughly for the accuracy of them and they're spot on with the exception of 2 areas in my daily living expenses that were on oversight on my part. In reality, those areas are actually higher amounts than what it is reported in my schedule and reported being lower but no biggie I am sure.

I am feeling a bit better, although still a bit worried because I don't want to have to go through an AP and the stress. I figure if they do file for an AP I'l retain another lawyer to write an objection letter and request to have it dismissed and then writing them telling them that they will be responsible for my attorney fees and they will also ask for sanctions and to withdraw it immediately. Either way, I'm not hiding anything. I just don't want to go through the unneseccary stress. I'm sure their knowing that they may be responsible for my attorney fees and sanctions to boot that they would probably withdraw it since i know money is tight for them.

Does ayone know if there is certain criteria that has to be met FIRST before they can file an AP? You know, that they would have to prove with some type of evidence they have in order to substantiate their claims? Or can a creditor go in an say, hey, I suspect this and this and this and that qualifies me for an AP? Don't they have to file a motion to determine the dischargeability of their debt first, etc? They have no basis that their debt is not dischargable. They can't claim such as in a credit card would and fraud and charging tons of stuff 90 days before which would render the disputed amount nondischargable. This is for past legal fees.

Is it only the TT and US TT that can request an AP if THEY suspected hiding of assets, etc, or misrepresentations on my schedules since this prior group has no basis for requesting an AP? I know that lawsuits can be filed at any time that are groundless. But if the TT and US TT realizes what this creditor is attempting to do and finding whatever they can, even though pulling at straws, can the TT and US TT deny them an AP? Or does this really not matter and they can file for an AP regardless?

Everything that I have read where an AP goes forward is usually around CC debt in the 90 days prior to BK, intentional misrepresentations, hiding of assets, etc. I have not read anything about an AP in regards to an unsecured creditor where there was no fraud involved with them, major CC purchases, etc. Even when my TT asked the creditor, "What assets do you think she is hiding?" And the creditor was caught off gaurd by the question and then responded with a possible asset by another family member who doesn't even own such an asset and I don't own such an asset either. The TT then proceeded to ask questions and then basically did the slap down on this creditor and making him look like a fool.

I don't know. I just need to relax and breathe and hope it doesn't happen and just take it from there. But a lot easier said than done.

[keptdigging]

If you do go to an AP, this sounds like a classic case of being able to get a judgment against THEM for your attorney's fees. From what I've read it looks like the CC companies have it down to show enough "good faith" in their APs to not have to cover your fees... but this creditor sounds clueless. Or... if this creditor does have a clue he/she'll eventually roll over and play dead.

Nobody is more interested in any hidden assets than the TT.... if the TT doesn't see a possibility there is no case. Too bad there are costs and attorney's fees in this world... I think you would enjoy this getting before a judge... a busy overworked judge.

[Flatbroke1]

Don't worry.....

I had tried to settle with my creditors, I didn't have enough to offer to interest them. One sued me and within 30 days I filled. That is what bankruptcy is for....protection from creditors.