Here at Henshaw & Henry, PC, we handle bankruptcy cases, as well as litigation cases. Many of our litigation cases derive from bankruptcy filings. We recently received a favorable decision in the Alameda Superior Court wherein a plaintiff sued our clients (both individuals and corporations) over various contract and tort claims. The plaintiff sought to obtain a large sum of money based on an investment he and his wife made in a restaurant business.
One of the major issues in the case was whether two of the defendants (husband and wife) could be held liable in the case even though the facts of the case took place after the couple filed for bankruptcy, and later received a bankruptcy discharge. The plaintiff was never considered or named a creditor by the defendants in their bankruptcy filing. But, the plaintiff had knowledge of the bankruptcy filing while it was pending.
The court held that the bankruptcy discharge precluded the plaintiff from any damages from the couple because of their bankruptcy. The plaintiff had actual knowledge of the bankruptcy, and chose not to pursue any action in the bankruptcy court.
The case ultimately went to both a bench and jury trial, with the defendants prevailing in all matters.