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Beware the Intersection of Tort Law and Bankruptcy

Personal and business bankruptcies often arise in one of two ways. First, the debtor gets a little behind his bills one month. Instead of paying his obligations out of cash-on-hand, he puts it on a high interest credit card. Several months – maybe even a few years – go by and bills continue to steadily mount. He keeps falling behind, little by little. Finally, the debtor realizes he can never pay all of the late fees, penalty interest, and new principal he’s accumulated. Facing this situation, he decides to file for bankruptcy protection.


This kind of strangulation insolvency is common, and it happens to debtors like you every day. However, there’s another kind of run-up to bankruptcy. Not with a whimper, but a bang, the debtor is hit with thousands of dollars in unexpected bills. Whatever the cause – job loss, medical expenses, divorce, or a personal injury lawsuit – the effect is as painfully obvious as it is sudden: the debt is just too much to bear. Staring down an ocean of red ink, the debtor choses to seek bankruptcy protection.


Are you a tort law victim who is concerned about whether the person who injured you might use bankruptcy protection in an attempt to shield his liability? What can you do to protect yourself and your family from this legal gambit? It’s important to speak with a qualified, experience attorney to find out how tort law and bankruptcy intersect.


Financial obligations based in intentional tort or a drunk driving accident are generally non-dischargeable. However, most other kinds of obligations are dischargeable, including many types of legal obligations like tort actions. Additionally, because tort claims are a kind of unsecured claim, other claimants, notably secured creditors, may have a better shot at full or significant repayment.


Interested in finding out how to protect yourself from these default risks? The dedicated Fears Nachawati attorneys can help you. For the information you need about the intersection of tort law and bankruptcy, contact our professionals today.

Bankruptcy Business Law Personal Injury

Beware the Intersection of Tort Law and Bankruptcy