[CLBS] PI claim awarded after a Chapter 7 closed

[Rocky Wixom]

H
ere are the facts:

Client sees a national law firm commercial and believes he may have a
personal injury claim for damages for taking a prescription drug.

 He contacts the firm, they screen it and send him a letter saying his
statute of limitations is run and there is no claim.

TWO YEARS LATER he files a chapter 7.  Because the law firm said there was
no claim he did not disclose the issue in any way to the Court or Trustee.
His no asset case closes in approximately 3 months from the petition.  I
never withdrew from the case.  I never withdraw from closed cases.

3 months after the case closed the national law firm re-evaluated cases of
his type and reached out to him to reopen the PI case  Turns out he is now
entitled to a very substantial recovery.

Not long ago the law firm called me and informed me of these facts which is
when I learned of any of this for the first time.

Question:

1) Because my client was told by a firm two years prior to filing that he
did not have a claim I do not believe he has any issues with bankruptcy
fraud, yet.  The firm has admitted that they originally told him he had no
case.   Am I wrong?


2) Isn't this an undisclosed contingent and unliquidated claim that existed
at the time of the bankruptcy despite the national law firms advice to the
contrary?  Thus isn't it property of the estate subject only to a PI
exemption to the extent reasonably necessary for support?

3) If so doesn't my client have a duty to re-open and list the asset and
claim any exemption?  Probably have to negotiate a compromise settlement?

3) what is the test for reasonably necessary for support of my client and
his minor children?

4) what if my client says he does not want to re list and bring to the
trustee's attention?
As the attorney of record in a closed case do I have a duty to re-open and
withdraw from the case without disclosing to the trustee what my client is
doing?  Or does the fact that it is closed mean I can walk away and let my
client run the risk of bankruptcy fraud for not allowing me to re-open and
disclose?

any thoughts would be appreciated.






-- 
Rocky L. Wixom, Attorney at Law
(208) 542-5298

Wixom Law Office, Inc.
PO Box 51334
Idaho Falls, Idaho  83405

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