Creditor Filed Civil Judgement During Automatic Stay

[startingover56]

I just ran my three CRs and found one of my creditors filed a  civil judgement while the automatic stay was in place.  I don't want ask my lawyer for anything because they are swamped and never get back to you anyway. I would love to handle this myself, where do I start?  Does anyone have any experience with this?  The BK was filed December 2007 and the judgement was filed in Feb 2008, clearly violating the automatic stay.  They are definitely on the schedule of creditors and now I need to get this off.  Also, if anyone is considering filing bankruptcy and they are on an automatic payment plan with the IRS, DO NOT tell them you are filing BK, they will automatically file a tax lien against you.  I thought I was doing the right thing by calling the IRS and telling them I was filing (even though I was on a payment plan-no liens) etc.  The guy said fine, just let us know when and call us back with a case number.  At that time he never said we are going to file a lien against you now.  I told him I wanted to assume my payment plan once everything was discharged-he never disagreed with that.  So please learn from my mistake....don't tell the IRS and it will be filed and discharged before they ever know about it (don't think they ever would anyway)..  Anyway back to my original question about the creditor - can anyone advise me on a starting point?  Thank you.......C

[Uniqua]

The BK trustee or the clerk of the court can tell you exactly what to do. However, I would send them a copy of the discharge, the BK code stating the violation and the Schedule showing them as a creditor. Make sure you send all of this to them by letter via certified mail return receipt requested or FedEx. Carbon copy the BK court trustee. In your letter, make sure you clearly state their violation and tell them they have 7-10 days to rectify this violation. If they do not delete it from your CRs, take them to court.

How were they able to obtain a judgment against you if you were not served a complaint and summons to appear in court? You need to find out the docket number for this case and notify the court that ruled in their favor of the violation of the automatic stay. Once you were served, you could have then submitted a copy of the automatic stay with your answer. The court would have had to dismiss the case if they were included in your BK.

[startingover56]

Thanks for the advice.  Actually, I moved out of state after filing bankruptcy.  We were served just before we left late on a Saturday night.  Didn't even think a server did that.  Thought it was someone lost looking for directions.  Next thing, he gives us this paperwork.  After that, I called the District Court and told them about my plans for bankruptcy.  At that point, I had not filed yet.  I figured I would put them on the schedule and then they would be notifiied and the matter would be dropped.  I was surprised to see it on my CR when I filed 12/07 and the judgement was entered 2/08 and I was discharged 05/08.  Does anyone have a sample letter in one of these threads as example of the format to use.  Thanks....C 

[Uniqua]

Sounds like you totally disregarded the complaint, which is so unwise to do. Regardless if you were going to file BK, you had an obligation to answer the complaint. Calling the court is not an answer. Thus the reason for the default judgment against you. But I guess that really doesn't matter right now. You can be served at any time, it doesn't matter the day of the week. Since you were served before you filed BK, I'm not sure you can have this judgment deleted. The ball was already rolling beforehand. You did not notify the BK court nor your attorney about the suit. The information on your CR may be reporting correctly.

You may/may not be able to find a draft letter to go by on here. However, the BK court can give you all the information you need. You need to let them (or the trustee) know about the violation. They will provide you with the exact BK code citing the violation. Perhaps they have a form you can use. I'm not sure. But the best answers will come from your attorney or the court. Make this a top priority come Tuesday morning.

Best of luck!

[startingover56]

I hesitate to call my attorney because they are so slow to do anything but I may have to.  Even though I was served, the creditor was still notified of the bankruptcy and being included in the schedule.  I would think that should override any notice to appear.  I did respond to the creditor by the court notifying them they were included in my bankruptcy, no?  I know I will have to make a bunch of phone calls and am not looking forward to it.  I was not served by the way, I just rememberd it was my mother who was home and they gave it to her.  Then when I came home that Saturday night she told me.  If a judgement is entered does the creditor then take it to the courthouse to be filed or does the court automatically file it themselves?  Sorry for all the ?????

[Uniqua]

I know how you feel about not wanting to call your attorney, but in this case you should do so without a doubt. I would also call the court. Don't worry about the questions. I'll help you as best I can since I cannot give you legal advice.

The papers were served to your place of residency. Therefore, you were served. When I say "answer" the complaint, I mean that you had an obligation to reply to it and send it back to court. This is where you could have included a copy of the BK filing along with the Schedule listing the creditor. The court would have either dismissed the lawsuit or the creditor would have had to withdraw it. Either way, you still had to answer and/or make appearance on the scheduled court date. Filing BK does not necessarily override it if the ball was already rolling. You had to make sure the court in which you were summoned to appear knew about it. Your attorney should have taken care of this. Did you show him/her the complaint in which you were served? Sometimes, the BK court may not get this information to your creditors in time. And, if the creditor still went ahead and got judgment against you, there's a pretty good chance they were not aware of the BK filing. You could have avoided getting to this point.

Now, the question is -- was the judgment entered before you filed? Your CR may say that the judgment was reported 2/08, but that may not be when the court ruled on the case. Obtaining the docket number can help you get this information. If you can search your previous state's judicial website, you may be able to search using your name.

In your case, judgment was entered by default against you because you either failed to answer and/or failed to make appearance. Judgment is entered immediately. The court sends out the order by mail (you should have gotten a copy). The creditor then notifies the CRAs of this judgment.

I highly doubt the civil court would have even heard the case if it were aware of it pending in BK court. But again, you need to contact your attorney to make sure.

Do it immediately. The last thing you want is for the creditor to obtain a bank execution or wage garnishment to start collecting this debt.

Message Edited by Uniqua on 05-25-2008 10:32 AM

[startingover56]

Ok, it is coming back to me now.  There was so much happening at this time, it seems like one big blur.  I know I called the court clerk and told them I could not appear since I had moved out of state.  A previous lawyer I had consulted told me when I moved not to file a change of address because I would receive a deluge of mail from the creditors.  The court had no current address on filie and any correspondence they would have sent would have been returned as moved no forwarding address.    The judgement was definitely filed after the BK because the clerk told me she would extend the court date to january and give me time to get the BK filed.  I guess she assumed I knew to include the court in the BK and not just the creditor.  In any event, the creditor probably received the BK letter sometime in Jan.  Again, they were just listed in my schedule of creditors and I did not include the court.  I assumed (and you know what happens when you do that) that they would see that they are included and would have droppped the matter.  I am wondering if when they were given the default judgement, did they go to court on that day?  If so, they would have gone to court knowing that I filed BK.  Then when the judge order the default judgement, did they have to take it and pay to have it filed against me?  I hate holidays because now I have to wait until Tuesday and God only knows when I will hear from my attorney let alone get a phone call back.  I have to get all that info, docket # etc.  Thanks so much!!!

[Uniqua]

Usually, when the judge makes the order of judgment, all parties to the case receive copies of the judge's order by mail. This order states why the plaintiff/defendant received the judgment and the amount(s) the plaintiff/defendant was ordered to pay (weekly/bi-weekly, etc.). The creditor does not have to pay to have the order filed against you, it is already final. The creditor then notifies the CRAs of the judgment, which now makes it onto your CRs.

The BK filing should have put an end to all of it. But you were negligent in notifying your attorney of the lawsuit who would have sent copies of the BK petition to the court and the creditor. This could have been done by fax. Most creditors are smart enough to know to back off when BK has been filed. There are penalties to pay for continuing to seek payment from a debtor, which is why I am assuming the creditor did not find out about the BK filing until after the judgment was granted. Otherwise, the creditor is a sleazy one trying to collect debt by falsifying documents and/or lying to get a judgment against you. I'm hoping it is not the latter.

Tuesday is but two days away. Do not be anxious. You may lose much needed sleep. There is nothing you can do until Tuesday anyway. If you are that against calling your attorney, do everything yourself. Call the clerk of the court who has the order. See if you can get a copy of it for free. Get their fax number and fax copies of all of the BK paperwork including the Schedule showing the creditor in the case. Include a copy of your CR if they require it. Then, call the BK court or the trustee and notify them of the violation. Fax them a copy of the order and also fax a copy of your CR if they require it as well.

And yes, the creditor (their attorney) went to court which is why they received the judgment. If neither of you had made an appearance, the case would have been dismissed. The judge can't hear the suit if neither party is there to present their case.