I have been disabled since 2010 after an injury. I have alot of debt since then because of not working and my only income now is social security disability. I want to file bankruptcy but just hired an attorney for medical malpractice after receiving a letter from the hospital that my surgeon had performed experimental surgery on me that I was not aware was experimental. Should I not file and can my debtors take my settlement if i get one?
Tough question. Generally, it's common for people to file bankruptcy while they have a Medical Malpractice (MM) claim for several reasons: 1) the process of going through a MM case can take years and 2) people do incur debt when they are disabled.
There are reasons NOT to file at this time as well. If you're essentially "uncollectible" right now, you may want to wait and let the MM process play out. This would allow you to negotiate directly with your creditors down the road if you settled or won the case.
If you do decide to file bankruptcy, there are specific things that will happen... the trustee assigned to your case will contact your MM attorney and hash out the details of who will be representing you in the future (in my jurisdiction, the trustees generally allow the original attorney to handle the case but I know that in other jurisdictions, that's not always the case.) There will be some type of exemption for your case - meaning a certain amount of money you'd be able to keep yourself if the case ever settled/won. Also, the amount of settlement left over after the trustee pays all your bills would revert back to you.
Knowing how much you owe and what your likely settlement value of your claim are important factors to weigh when considering whether or not to file bankruptcy at this point and it's important to talk to a qualified bankruptcy attorney in your area.
I would agree with my colleague. No one can tell you what you should do. The best way for you to decide your course of action is to talk with your med mal attorney about your case and likelihood success / potential amount of your claim, time table for your case, etc. Then you should consult with a couple of attorneys in your area that handle bankruptcy cases. Explain to your attorneys the situation with your med mal and they can best advise you on what would happen if you were to file now vs filing later. Keep in mind that either way, you are probably going to have to pay some amount of your debt, considering the settlement your going to receive. Good Luck!
If your only income is social security disability, then your creditors cannot take any of your income since social security income is federally protected. What is the reason you would be filing bankruptcy? Is it to protect property that you believe your creditors can take from you? You need to contact an attorney in your state to find out whether any of your property can be taken by a creditor if they sue you. It may turn out that you are "judgment proof" which means you have nothing for anyone to take.
On the issue of the medical malpractice action, was the surgery successful? Were you personally injured or damaged from the surgery? Did your attorney actually tell you that you had a viable medical malpractice case or did he/she tell you that they will look into it and let you know. It might turn out that you don't have a viable medical malpractice case.
The biggest question, and the most serious, is whether a bankruptcy trustee in your state can take a portion or the entire amount of any medical malpractice settlement or verdict. Consult an attorney in your state for whether a personal injury award becomes part of the bankruptcy estate and whether there's an exception for medical malpractice awards. This is a serious matter --it would be a shame for a large award to be just handed over to the bankruptcy trustee.
Get yourself a consultation with a bankruptcy attorney now so you can plan how best to proceed. It really depends on the potential value of your lawsuit, and the applicable exemptions you would use to protect the recovery. In addition to using the Find A Lawyer tab on this website to locate an attorney near you, you can also contact the State Bar for a referral.
You can file for bankruptcy but your medical malpractice case will belong to the trustee. The trustee could settle quickly in order to pay your creditors a dividend. The trustee may allow you to continue with your current counsel, but the settlement proceeds, if any, belong to the bankruptcy estate and will be used to pay your creditors. If money is left over, after paying all claims filed and administrative fees and costs, including your attorneys fees, you would receive the balance. Your attorney representing you would have to get his/her fees approved by the court. You may want to wait to file to see how the case proceeds. But definitely consult with an experienced bankruptcy lawyer to explore all of your options and see what is best for you.
In Bankruptcy all your assets including your medical malpractice claim (less exemptions, which are minimal in Florida) become property of a Bankruptcy Estate and are subject to potential distribution. About a month after filing a case you would meet with a Trustee who would ask for the contact information for the attorney handling your case. The Trustee would likely work with both sides of the case in an attempt to settle as fast as possible and distribute proceeds to your creditors.
I agree with one of the answers above: if your only income is SSD and you are also without assets there may be little to no benefit to filing Bankruptcy at this time. It is important to discuss this with an attorney, however, and many in this area offer free consultations.
