How is a personal injury settlement treated in a Chapter 7 bankruptcy?
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How is a personal injury settlement treated in a Chapter 7 bankruptcy?
I broke my ankle badly at a friend’s home; it required 2 surgeries to correct, as well as months of PT in order to walk without as much pain. This process from injury to “healed” lasted 14 months. When we had to file for bankruptcy. We were told that the trustee would require us to pursue a PI claim since any recovery would be an asset. Am I eligible to receive additional funds for pain and suffering in OR? We understand the first 10K is protected as well. The settlement was for 125K.
Asked on September 8, 2010 under Bankruptcy Law, Oregon
Answers:
M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
Here is the confusion that I am having: the matter settled. If it settled then it settled for all outstanding issues. Or do you mean are you entitled to receive funds over and above the $10,000 to which you are entitled under the bankruptcy exemption code? It is a good thought but the list of exemptions states a flat amount for the PI settlement and does not indicate that you would be able to receive more if the breakdown were differently in the settlement (i.e., lost wages versus pain and suffering). So unfortunately I think that the answer is no. I would, though, ask. It does not ever hurt to ask. Good luck.
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