Can a check by cashed by the Bankruptcy Court or trustee without endorsement of the debtor AND their lawyer?

Question

I did not claim a lawsuit in my bankruptcy as (a) I had not be qualified as a plaintiff at the time of the bankruptcy; (b) I was not guaranteed any moneys if I was qualified.

Almost a year after the bankruptcy was finished with, I was told that I would be getting some money.  The check was made out to myself AND my lawyer.

When I went to get the check, he told me that he had to inform the trustee.  The trustee wanted the ACTUAL CHECK - not a copy.

After 90 days, and I hadn't heard anything, I called the person who issued the check.  The check HAD BEEN CASHED on Feb 23rd.  I was not notified.  I had not signed the check.  I had not given verbal or written agreement to sign the check over.

The check was not payable to the trustee or the the US Bankruptcy court.  I feel fraud was involved.  I have no idea where the money is.

Atavacron · Accepted Answer

The trustee can take it and take it without your say so. The trustee is allowed to take any money from settlements for your creditors for up to a year after you file.

****

The filing of a bankruptcy petition by your client creates a bankruptcy estate which the Trustee is appointed to administer. Pursuant to 11 U.S.C. section 541(a), property of the estate consists of all legal or equitable interests of the debtor in property as of the commencement of the case.

The right to the proceeds of the personal injury lawsuit become property of the estate and, upon the filing of the bankruptcy, the Trustee succeeds to any right of the debtor in the lawsuit.

http://www.dcba.org/brief/junissue/1998/art50698.htm

As long as the suit was filed before your discharge the settlement belongs to the estate, and, therefore the trustee. It doesn't matter if you didn't know you qualified at the time.

If the suit was filed AFTER the date of your formal discharge, then call your lawyer.

Anonymous · Answer

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RE Can a check by cashed by the Bankruptcy Court or trustee without endorsement of the debtor AND their lawyer?

I did not claim a lawsuit in my bankruptcy as (a) I had not be qualified as a plaintiff at the time of the bankruptcy; (b) I was not guaranteed any moneys if I was qualified.

Almost a year after the bankruptcy was finished with, I was told that I would be getting some money. The check was made out to myself AND my lawyer.

When I went to get the check, he told me that he had to inform the trustee. The trustee wanted the ACTUAL CHECK - not a copy.

After 90 days, and I hadn't heard anything, I called the person who issued the check. The check HAD BEEN CASHED on Feb 23rd. I was not notified. I had not signed the check. I had not given verbal or written agreement to sign the check over.

The check was not payable to the trustee or the the US Bankruptcy court. I feel fraud was involved. I have no idea where the money is.

redenz40 · Answer

Contact your trustee and find out if they indeed received the check and what they are going to do with the money. If they won't help contact your bankruptcy attorney. It really surprises me that they did not contact your bankruptcy attorney. Sometimes a bankruptcy attorney can and will get you the money from a law suit by informing the trustee why the money is not a part of the bankruptcy estate.

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Can a check by cashed by the Bankruptcy Court or trustee without endorsement of the debtor AND their lawyer?

3 Answers