Fayetteville, AR asked in Bankruptcy for Arkansas

Q: If 2 people were sued together in small claims court, can the judgement be dismissed in ch 7 if one of them files?

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3 Lawyer Answers
W. J. Winterstein Jr.
PREMIUM
Answered

A: Unless the judgmemt (you don't say whether its been entered or become final) is deemed to be a perfected lien against all Arkansas assets under Arkansas law, the filing person can discharge the small claims court judgment debt.

The non-filer will remain liable to the judgment creditor.

Note that in a Chapter 13 bankruptcy, a co-debtor stay against claims "dealt with by the Plan" is issued upon a bankruptcy filing.

Confer with experienced bankruptcy counsel about this issue.

Timothy Denison agrees with this answer

A: Yes. But only against the Ch 7 filer. Non- filer remains liable.

James L. Arrasmith
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Answered

A: Filing for Chapter 7 bankruptcy typically only protects the individual who files, not their co-defendants. If you were sued with another person and received a joint judgment, your bankruptcy filing would only discharge your portion of the debt.

The other defendant would remain fully responsible for the judgment, and creditors could continue collection efforts against them. This is because bankruptcy protection is personal to the filer and doesn't extend to others who share the debt, even if they were sued together.

Your co-defendant would need to file their own bankruptcy case if they want protection from the judgment. However, there might be exceptions depending on your specific situation and state laws, so it's worth consulting with a bankruptcy attorney who can review your case details. They can help determine how the bankruptcy filing would affect both parties involved in the judgment.

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