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Getting sued after car accident, garnished wages?


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Know this is a little off topic compared to the regular posts about being sued by JDB but you guys have been really helpful to me in the past. So my girlfriend got into an car accident a month or so ago. She was deemed at fault. So just this morning she got a call from a someone at her insurance company saying the other party wants more money then she is covered for and is planning to sue. She told the guy she didn't have any money and they just told her they do wage garnishes.  She is very upset now as you could guess. So shes already about to file bankruptcy for an unplanned trip the hospital for the tune of 30k, would that bankruptcy also discharge anything that would come from a possible car crash law suit? 

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She would have to include them in the BK.

If she didn't include them, and they didn't sue her until after her BK was done, they may be able to sue.  But a BK lawyer may be able to advise better, I think if the debt was incurred before the BK it would be included.

They just can't go up and garnish her wages.  In order to do that they would need to take her to court, win the lawsuit, get a judgement, then put in a writ for garnishment. 

Who knows if they would even win.  If she had insurance, then that should cover her unless it was really bad insurance, or there were some kind of exclusions. (like DUI when the accident occured) 

Im sure most people that are involved in a collosion and found not to be at fault think they can get more, but that is usually not the case, they are usually lucky to get what the insurance will pay unless they can prove neglect, or wilful wrongdoing. 

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She would have to include them in the BK.

If she didn't include them, and they didn't sue her until after her BK was done, they may be able to sue.  But a BK lawyer may be able to advise better, I think if the debt was incurred before the BK it would be included.

They just can't go up and garnish her wages.  In order to do that they would need to take her to court, win the lawsuit, get a judgement, then put in a writ for garnishment. 

Who knows if they would even win.  If she had insurance, then that should cover her unless it was really bad insurance, or there were some kind of exclusions. (like DUI when the accident occured) 

Im sure most people that are involved in a collosion and found not to be at fault think they can get more, but that is usually not the case, they are usually lucky to get what the insurance will pay unless they can prove neglect, or wilful wrongdoing. 

No DUI or anything so thats in the clear. She has not filed the bankruptcy yet but is planning to. I just think is saber rattling from the other side but thats just my opinion   

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What is enough liability insurance anymore, $1M, $2M, $5M?

What I am assuming is that your girlfriend had the state minimum type of policy. The expenses turned out to be more than the minimums so the other party's insurance company had to put out on the underinsured/uninsured part of the policy. Now the insurance company is going to try to get their money back.

What your girlfriend needs to do is find out who the attorney is for the other party. If she is using an attorney for the BK, she needs to talk to them but most likely, they will call the other attorney and explain that they are about to be hit with a BK and the insurance money is all they are getting. I say have the BK attorney do this because I am sure the attorney for the other side will claim that they can take her license or get an exemption under the negligence rules but will be less likely to make such claims to an attorney that knows better.

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She told the guy she didn't have any money and they just told her they do wage garnishes.  

 

"The guy" is WRONG.  Pennsylvania is one of the few states that does not allow wage garnishment.  Even if she does lose the suit they cannot garnish her wages.  They can levy bank accounts though.  If she is already filing BK on the large hospital debt then I would simply include this creditor and get it dismissed in the BK.  

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As everyone here already knows I am not an attorney and I have no experience with her situation. With a little fast research I am guessing she should wait until they sue her and get a judgment before filing BK. One thing that sounds a little strange is that your insurance company is talking about this so soon after the accident. Usually litigation in these matters takes at least months if not years to play through. 

 

Definitely talk this over with the BK attorney and then find another attorney not involved and pay a little for an opinion. The scary thing is that she might have an insurance company (that wants to save their money) and a BK attorney (that want to get his/her money) without taking her best interest into account. In situations like these don't just trust one "professional's" opinion. Get more than one even if you have to pay for it.

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Okay thanks guys, shes gonna see her bankruptcy lawyer on Monday. This thread has calmed her down a lot. She had a bad year but it turning it around now as she just about to start school next week. 

 

"The guy" is WRONG.  Pennsylvania is one of the few states that does not allow wage garnishment.  Even if she does lose the suit they cannot garnish her wages.  They can levy bank accounts though.  If she is already filing BK on the large hospital debt then I would simply include this creditor and get it dismissed in the BK.  

 

Really? What I read it says they can, she doesn't have anything in her bank account. Doesn't have anything in her name besides a old car that's worth more in scrap metal. 

 

"professional's" opinion. Get more than one even if you have to pay for it.

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You would have to look up the rules of civil procedure to determine what they can take and not take if they get a judgement. I know that if you do not have insurance, they can take your driver's license until you pay the debt but I am unsure of what happens in the case where you have the amount of insurance coverage mandated by the state but it was not enough.

As for waiting to file BK, the OP's girlfriend may not have that option if she has medical collections hounding her and about to take her to court. It still would pay to get the opinion of a 3rd party professional as they would probably have your girlfriend's interests at heart.

As for the insurance company, even if the OP's girlfriend declared BK, they would still be on the hook for the policy max.Her BK does not relieve them of that liability.

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Most insurance contracts have a "duty to defend."  That duty extends only to the policy limits - above that, then she could be on the hook...she may want to escalate this - get someone else in the company to handle the claim. If they want out this quickly and leave you holding the bag, then you theoretically can sue for breach of contract.

 

 

Since she was deemed at fault, then it could be likely that a BK filing may not wipe out any potential liability. Certain tort causes are not discharged in BK. Speak with an attorney to be sure.

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Usually to stop the automatic stay and discharge of a tort like this in BK, the other side usually has to show more than usual negligence. In most auto accidents, that usually requires that the person declaring BK was charged with at least a DUI/DWI or vehicular manslaughter. In this case, it sounds like a simple traffic infraction and those rarely if ever survive the discharge.

Certainly discuss this with the BK attorney but also with a 3rd attorney who has no interest in the outcome.

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http://www.denhalaw.com/?p=626

 

 

 Debts Arising From Car Accidents – If the car accident was the result of negligence (i.e. careless driving or failing to drive in a prudent manner), the debt arising from the accident can be discharged in bankruptcy. However, if the car accident results from reckless driving (i.e. willful or malicious acts as well as drunk driving), it will not be discharged under Bankruptcy

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