Wednesday, October 9, 2013

5th Cir. Continuing Duty to Disclose - Even in a Chapter 13 - No disclosure -> Judicially Estopped!

Even in a Chapter 13 case, disclosure is the key.  In this case, the Debtor filed a Chapter 13 case and was injured after the filing.  The Debtor did not disclose the personal injury accident and proceeded to file suit.  The Defendants filed a motion asserting judicial estoppel.  The Court held in favor of the Defendants but permitted the Chapter 13 Trustee to proceed but citied to Reed which held that the Trustee can proceed, but any remaining funds after distribution to the creditors would be returned to the defendants.

In re Flugence 2013 5th Cir.

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