Lawsuit and automatic stay

[AZNoName]

So I have a pending lawsuit going on, where I am included along with several other defendants. I filed yesterday and included the lawsuit in the BK, which I assume will put a stop to the lawsuit for now.

Will the other defendants benefit from my BK, in that the stay will delay the lawsuit for them as well? Or does this only benefit me?

(dumb question, I'm sure...)

[frogger]

If the lawsuit listed all of you together, then they will most likely need to dismiss the suit and start over, leaving you out of the mix.

As to what they will do? Who knows. It's very possible that they will delay for some time.

[despritfreya]

No disrespect to Frogger. . .

Assuming you filed a Chapter 7, the suit can continue as to the non-bk defendants. There is no automatic stay against continuing the suit as to those parties. I assume your attorney has filed a Notice of Bankruptcy Filing in the State Court matter.

Des.

[frogger]

No disrespect to Frogger. . .

Assuming you filed a Chapter 7, the suit can continue as to the non-bk defendants. There is no automatic stay against continuing the suit as to those parties. I assume your attorney has filed a Notice of Bankruptcy Filing in the State Court matter.

Des.

You know, after thinking about this some more and reading your remarks, it reminds me of the way suits run anyway. You sue everyone and let the judge sort it out. You are correct in this Des that one person can be dropped from the suit and the suit continues on.

Should have put my thinking cap on before speaking. Thanks.

[AZNoName]

I filed a CH13. We did include the suit in the BK, and I assume the appropriate agency will send the notice to the attorney/plaintiff in the suit.

[AngelinaCat]

I would have to add here: DON'T ASSUME ANYTHING!

Make sure that all parties are included in your creditor mailing matrix. You should be able to review your matrix on PACER if you don't have your original paperwork at hand. This is your case, your family and your financial health. You MUST be PRO-active, not RE-active.

Good wishes to you, and I really don't mean to *shout*.

[AZNoName]

I would have to add here: DON'T ASSUME ANYTHING!

Make sure that all parties are included in your creditor mailing matrix. You should be able to review your matrix on PACER if you don't have your original paperwork at hand. This is your case, your family and your financial health. You MUST be PRO-active, not RE-active.

Good wishes to you, and I really don't mean to *shout*.

Yep, I verified that everyone (including lawsuit atty) is listed on the mailing matrix!

[AngelinaCat]

Very GOOD. Thank you for easing my mind!

[despritfreya]

I filed a CH13. We did include the suit in the BK, and I assume the appropriate agency will send the notice to the attorney/plaintiff in the suit.

It does not sound like a Notice of Bankruptcy Filing was sent to the Superior Court. Your attorney may have notified Plaintiff’s attorney the moment your case was filed therefore he may be relying on the Plaintiff’s attny to notify the Superior Court, but you should check on this to be sure.

As to this being a 13, if the suit relates to a consumer debt, the co-debtor stay of 11 USC 1301(a) kicks in and until the co-debtor stay is lifted the State Court suit is stayed. If the debt is not a "consumer" debt then the suit may proceed against the co-defendants.

Des.

[ttg1]

Not to twist anyone horns here but the question of whether a suit can go on if one of the parties files for BK is a complicated one. Not all lawsuits for money due are severable; it depends on the facts of the case. The comment about letting the judge sort it out is the one that is nearest the mark.

BTW, if there is a pending lawsuit there is really no need to include the attorney on the creditor mailing matrix (not that it hurts). The plaintiff's lawyer will get a notice from the court whenever the motion to stay the case is filed.

[despritfreya]

. . . the question of whether a suit can go on if one of the parties files for BK is a complicated one. Not all lawsuits for money due are severable; it depends on the facts of the case. . . BTW, if there is a pending lawsuit there is really no need to include the attorney on the creditor mailing matrix (not that it hurts). The plaintiff's lawyer will get a notice from the court whenever the motion to stay the case is filed.

Sorry, but it is not that complicated. If the debtor is an "indispensable party" then plaintiff will simply get the stay lifted for the purpose of finding liability vs. the bk defendant. But, until that happens, the suit and all of its time limits as it relates to the non-debtor defendants will continue.

As far as not including the attny (I assume you mean the plaintiff's attny) on the mailing matrix, such would be a mistake. The debtor needs to make sure ALL relevant parties and representatives are notified. The bk court will not be notifying the state court or anyone who is not on the mailing matrix. Either the debtor or plaintiff's counsel needs to file a notice of bk filing and, in the 9th Cir., a creditor has an affirmative duty to take steps to cease collections, including the continuation of such a suit. (See Eskanos & Adler, P.C. v. Leetien 309 F.3d 1210 (9th Cir. 2002)).

Des.