Civil litigation
#1
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Joined: Oct 2019
Posts: 22
Civil litigation
A young friend of mine was sued by someone for a personal damage / emotional stress claim in a civil litigation. The damage claim is approximately $50k but he only had $10k in the bank with no additional assets, if he loses the lawsuit or can no longer afford his attorney fees given that he doesn’t have enough money then what happens? Will he be going to jail because he can’t afford to pay even though this is not a criminal matter? What should he do once he exhausted all his money in the lawsuit? Should he file bankruptcy chapter 7? Any advice will be highly appreciated!
#2
Re: Civil litigation
A young friend of mine was sued by someone for a personal damage / emotional stress claim in a civil litigation. The damage claim is approximately $50k but he only had $10k in the bank with no additional assets, if he loses the lawsuit or can no longer afford his attorney fees given that he doesn’t have enough money then what happens? Will he be going to jail because he can’t afford to pay even though this is not a criminal matter? What should he do once he exhausted all his money in the lawsuit? Should he file bankruptcy chapter 7? Any advice will be highly appreciated!
https://www.credit.com/blog/how-long...-report-51696/
#4
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Joined: Jan 2006
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Re: Civil litigation
He should contact a bankruptcy lawyer, they usually do consults and they can give some advice is bankruptcy is an option in his circumstances. Bankruptcy lawyers often do consults free of charge to discuss options.
If he has a lawyer currently he should also be asking his lawyer what his options are.
Bankruptcy is federal jurisdiction not state.
He wont go to jail over a civil matter.
If he has a lawyer currently he should also be asking his lawyer what his options are.
Bankruptcy is federal jurisdiction not state.
He wont go to jail over a civil matter.
#5
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Joined: Dec 2015
Location: TX
Posts: 346
Re: Civil litigation
A young friend of mine was sued by someone for a personal damage / emotional stress claim in a civil litigation. The damage claim is approximately $50k but he only had $10k in the bank with no additional assets, if he loses the lawsuit or can no longer afford his attorney fees given that he doesn’t have enough money then what happens? Will he be going to jail because he can’t afford to pay even though this is not a criminal matter? What should he do once he exhausted all his money in the lawsuit? Should he file bankruptcy chapter 7? Any advice will be highly appreciated!
#6
Re: Civil litigation
I guess the first question is; does your friend plan on contesting or admitting to the case? If he chooses to admit, the total cost can be negotiated. He may have insurance that would cover something like this. If he wants to deny then it really depends on the facts of the case. Being up front and admitting he doesn't have money or assets will go a long way. Once the other side sees they are wasting their time, they may drop the matter. They won't get any money if he claims bankruptcy anyway.
#7
Re: Civil litigation
They can enforce the judgment with either a lien or a wage garnishment usually. It will also likely hit his credit report - this will happen if a judgement is entered against him either way.
#8
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Joined: Oct 2019
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Re: Civil litigation
Thank you, in terms of the lien, is it assets in the US or there’s a way to impose alien on his assets in the UK? How long will the wage garnishment expire? Like 5 or 10 years?
#9
Re: Civil litigation
Usually assets in the US only, international collections can get very complicated and expensive, but are not impossible.
Garnishment would be until full judgement is paid same as any debt collection lawsuit, even if it takes 50 years.
Garnishment would be until full judgement is paid same as any debt collection lawsuit, even if it takes 50 years.
#12
Re: Civil litigation
I was once sued for $1 million in a civil suit. If he only has $10k that will soon be eaten up in lawyer fees and going to court with cost more than that. My lawyer estimated preparing for court and the hearing would run $40k. Fortunately I had insurance and they settled with the guy for $3,500. By that time my insurance had paid out over $10k in lawyers fees. Settling was cheaper than going to court.
#13
Account Closed
Joined: Jan 2006
Posts: 0
Re: Civil litigation
Seems if he lacks the cash to really fight, is likely to lose, and appears to have no assets, seems letting the other side win by default, the file for bankruptcy protection would be the most economical way.
Granted certain types of judgements can't be discharged but a lot of judgements can be.
Granted certain types of judgements can't be discharged but a lot of judgements can be.
#14
Re: Civil litigation
Generally speaking, the are two reasons to sue someone in civil court - they have assets, or they have insurance. Home owner's insurance usually comes with fairly hefty liability coverage, and I suspect that renters insurance may have a smaller sum in respect of liability.
If he has no liability insurance, and few assets, then I would suggest that retaining a lawyer to explain that to the plaintiff might be a way out of the predicament, as unless the plaintiff is an idiot, or a vindictive a-hole (either of which is possible ), he is just going to run up legal and court fees that he'll never recover.
Last edited by Pulaski; Oct 4th 2020 at 9:51 pm.
#15
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Joined: May 2010
Location: San Diego, California
Posts: 9,618
Re: Civil litigation
With all due respect, I would argue that that is the second question. The first question is "Does he have any liability insurance?"
Generally speaking, the are two reasons to sue someone in civil court - they have assets, or they have insurance. Home owner's insurance usually comes with fairly hefty liability coverage, and I suspect that renters insurance may have a smaller sum in respect of liability.
If he has no liability insurance, and few assets, then I would suggest that retaining a lawyer to explain that to the plaintiff might be a way out of the predicament, as unless the plaintiff is an idiot, or a vindictive a-hole (either of which is possible ), he is just going to run up legal and court fees that he'll never recover.
Generally speaking, the are two reasons to sue someone in civil court - they have assets, or they have insurance. Home owner's insurance usually comes with fairly hefty liability coverage, and I suspect that renters insurance may have a smaller sum in respect of liability.
If he has no liability insurance, and few assets, then I would suggest that retaining a lawyer to explain that to the plaintiff might be a way out of the predicament, as unless the plaintiff is an idiot, or a vindictive a-hole (either of which is possible ), he is just going to run up legal and court fees that he'll never recover.