What happens if the defendant in your personal injury case files bankruptcy?

Posted by Guy DiMartino | Aug 31, 2015 | 0 Comments

You were severely injured in an accident and you are making a claim against the person or corporation for your injuries. One day you open your mail and find a notice from the bankruptcy court telling you that the other party has filed for bankruptcy – how does this impact your case.

As an overview there are two general things that you have to know about bankruptcy:

  • The first is that if you are making a personal injury claim – you are classified as a potential unsecured creditor – just like a credit card company.
  • The second is that once the bankruptcy petition is file there is an automatic stay in place, which means your case cannot go forward.

How we handle the situation depends on whether the defendant is an individual or business with a liability insurance company or not.

First, let's talk about the claim against a defendant with insurance. If the defendant is insured, we can file a motion in the bankruptcy court asking the Court to lift the stay to the extent of liability insurance. In other words, the bankruptcy estate will not be responsible or liable to you. Any recovery will be limited to the amount of available insurance. So you will only be able to get money from the insurance company and not the individual or the business, even if your damages are worth much more than the insurance proceeds.

If the defendant is a self insured – like a lot of big companies – you are going to be at the mercy of the bankruptcy proceeding. You will have to make a claim against the bankruptcy estate and you will be considered an unsecured creditor.

A dozen years ago my clients had a number of pending settlements when K-Mart filed for bankruptcy. In the end, the bankruptcy court ended giving unsecured creditors about 11 cents on the dollar – in these situations there is not much that can be done.

If you have any questions about how bankruptcy can impact your Leesburg Florida personal injury claim, call (352) 267-9168.

Guy S. DiMartino, DC, JD, PA
918 W. Main Street

Phone: 3522679168

About the Author

Guy DiMartino

I have loved helping people in need for almost three decades.  It has been my privilege to serve people as their pastor, chiropractor, and lawyer.  The current focus of my legal practice and life’s passion is helping the seriously injured receive complete compensation for their injuries. I am a Florida Board Certified Civil Trial Attorney. What that really means is that I am no stranger to the courtroom.  I have successfully tried and handled serious cases in state and federal courts.  My backgrounds in both law and chiropractic medicine have given me a unique perspective, extensive knowledge, and wide experience to serve those I represent. For years as a chiropractic physician, I treated my patients to alleviate their pain and suffering. Now as their lawyer, I fight to bring them financial compensation for their pain and suffering. During my years of service, I have handled many traumatic injury cases ranging from the traumatic amputation of a limb to brain and spinal cord injury.  I consider it an honor to serve you and your family. When a person entrusts me and I accept to represent them, I don’t take that relationship and responsibility lightly. My approach is that we work as a team. We are partners and our goal is the best outcome for you and your family with the highest level of communication throughout. I am always available by phone or email to discuss my potential representation of your injury case. I handle cases throughout Florida. Education: National University of Health Sciences – BS (1984), DC (1986) Valparaiso University School of Law – JD, summa cum laude (1999) Bar Admissions: Florida (2000), Indiana (1999), Illinois (2000, expired); US District Courts of Appeals (11th Circuit, 7th Circuit); United States District Courts: Southern and Middle Districts of Florida; Northern and Southern Districts of Indiana; Northern and Central Districts of Illinois; and District of Colorado. Certification:  Civil Trial, Florida Bar Guy DiMartino on Google+ – Circle Guy on Google+ Guy DiMartino on Google+


There are no comments for this post. Be the first and Add your Comment below.

Leave a Comment

What makes me Unique?

What distinguishes my firm from the many injury firms throughout the state is my background as a chiropractic physician treating injured patients for 17 years. This gives you the benefit of having someone fighting for you that understands the nature and extent of your injuries and your road to recovery.

We are Partners

If you are my client, we are partners in your road to recovery. You will always have direct access to me to have your questions answered.

Copyright © 2017 Guy S. DiMartino DC, JD, PA

Areas That We Serve: Hammond, IN | Highland , IN | St. John, IN | Schererville, IN | Griffith, IN | Merrillville, IN | Hobart, IN | Portage, IN | Burns Harbor, IN | Ogden Dunes, IN | Gary, IN | South Haven, IN | Valparaiso, IN | Kouts, IN | Knox, IN | Hebron, IN | DeMotte, IN | Cedar Lake, IN | Crown Point, IN | Dyer, IN | Lowell, IN | Michigan City, IN | LaPorte, IN | Wanatah, IN | Westville, IN | Winamac, IN | South Bend, IN | Plymouth, IN | Elkhart, IN | Whiting, IN | Rolling Prairie, IN