Bankruptcy Judge Prevents Debtor from Discharging Debts Due to Repeated Filings

by San Antonio Attorney

A debtor can file for Chapter 13 bankruptcy many times, but a court has the authority to deny a debt discharge in future bankruptcy filings.

U.S. Bankruptcy Court Judge Robert E. Nugent decided on Dec. 9 that even though it is an extreme remedy, preventing a discharge in a potential case was suitable in the case at this point.  For the past 14 years, the debtor has filed 5 bankruptcy cases and had inappropriately received and spent a $25,000 settlement to the disadvantage of her creditors and bankruptcy estate, the court held.

Since 2002, Vickie Rios had declared bankruptcy five times both under Chapter 7, which is an asset liquidation proceeding, and Chapter 13, which allows debtors with regular stream of income to get debt reprieve while keeping their assets.

Rios last bankruptcy filing was Chapter 13 in 2013.  While the July 2013 court order disallowed her from disposing any of her assets without the consent of the court, the debtor sought, received, and used up a settlement worth $25,000 from her previous employer without informing the court.

After an objection was filed by the bankruptcy trustee, the debtor tried to dismiss her own bankruptcy case.  The court said Rios intended to file for Chapter 13, and if she received another discharge it would have been her fourth

Time restrictions on when an individual can receive another debt discharge depend on whether he or she formerly received a discharge under Chapter 7 or Chapter 13 as well as the bankruptcy type that will be filed.  Find out if you are eligible for a discharge by consulting a Bankruptcy Lawyer San Antonio.

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