Expert: Mark J. Markus- California Bankruptcy Attorney - 11/9/2007

Question
QUESTION: Again, I apologize. The question I want to ask is can I file a claim with the
bankruptcy court for fraud against my husband? If the bankruptcy case does
not go through I have a chance in the divorce proceeding to recover marital
assets. If his bankruptcy case is discharged, there will be no assets to divide
in the subsequent divorce proceedings. He is self employed, so even if I
receive a judgement in my favor there will be no wages/assets to garnish. I
have had to hire a forensic accountant but it will be pointless for him to give
his report in the divorce proceedings as there will be no assets to split. I have
no more money to spend on an attorney. I spoke to an attorney about this
and he felt I would probably win a suit against him but it will cost $15.000-
$25,000. Is there anything I can do myself???

ANSWER: Well, if you have actual evidence of fraud, you can contact the Trustee in his case and provide the evidence and see what happens, but all that will do is get his discharge denied, it won't stop the administration of assets.  You still have an entitlement (presumably) to your share of the marital assets, depending on your state's community property laws.  You need to make sure that you get put on the mailing list for the case (if you're not already) and object if and when the Trustee tries to sell anything, to make sure you get your share.  You really need to sit down with a bankruptcy attorney in your area to go over this in more detail.

---------- FOLLOW-UP ----------

QUESTION: thank you. I do live in California a community property state.
My husband has his two brothers who are lawyers guiding him and I have
been overwhelmed at their duplicity.

Answer
I understand.  Unless he filed a Ch. 13 case, he cannot discharge the obligations he owes you from the property division.   Thus you need to file a claim if and when the Trustee sends out such a notice and, as I said, object (not necessarily object, but at least make sure you get paid the portion of the sales proceeds) if any assets to which you have a partial entitlement are being sold.   If he failed to list assets, you should definitely bring that to the Trustee's attention.  Again, I'm assuming this is a Chapter 7 case that was filed.