Bankruptcy + Divorce

[socrateaser]

>My BK Attorney said no no no do not sign the hold harmless
>clause.  
>
>We had the 341 meeting and the trustee asked about divorce
>proceedings when I told him "yes" he asked what the
>distrobution was and I told him we had no assets only debts,
>he said fine that he didn't need any more information and I
>was done.  My attorney told me that I was finished and again
>reminded me not to sign the hold harmless clause.
>
>I called my wife's attorney and he told me that he would email
>the decree and for me to change the hold harmless wording to
>specifically exclude the discharged debt and to only cover
>liabilities that happened after our separation.  He said to
>sign it, send it, and he would file as soon as he could.
>
>Any thoughts on the wording?

Under the circumstances, I must defer to your bk attorney. I think that you should have the two attorneys discuss the hold harmless clause and its consequences.

[crayiii]

Thank you for your advice my friend.  I appreciate all you have helped me with!

[crayiii]

Here's the wording:


Each party shall hold the other party harmless from any collection action relating to separate or community liabilities incurred since the date of separation including reasonable attorney's fees and costs incurred in defending against any attempts to collect an obligation of the other party.


Does this sound reasonable?

[socrateaser]

>Here's the wording:
>
>
>Each party shall hold the other party harmless from any
>collection action relating to separate or community
>liabilities incurred since the date of separation including
>reasonable attorney's fees and costs incurred in defending
>against any attempts to collect an obligation of the other
>party.
>
>
>Does this sound reasonable?

As to community obligations, yes, because these are partnership duties. As to separate obligations, no, because the object of a separate duty is for it to be SEPARATE. Why should you be responsible for paying on a debt that your wife has incurred on her own? This defeats the courts distribution of assets and liabilities, and in my view, is a ridiculous provision.

But, the risk is all based upon how the court distributes the assets and debts, because if the distribution demonstrates no risk, then the words of the clause have no substantive use.

Nevertheless, the objective of a divorce is to get loose of the other person, and a hold harmless clause keeps each of you liable to each other. Therefore, I would not sign, especially as to any separate debts.