Does Bankruptcy Affect Statutes of Limitations On Other Types of Cases?

adding timeSomething most people do not realize (including attorneys who are not versed in bankruptcy law), is that if someone has been hurt and there is a statute of limitations governing the timeline the person has to take action upon that injury (using personal injury as one example), filing a bankruptcy will extend such statute of limitations by 2 years as long as the filing of the bankruptcy was before the expiration date of the original statute of limitations.

Bankruptcy Code § 108(a) allows a bankruptcy trustee to commence an action on behalf of a debtor’s estate within the period allowed by state law for such an action, or within two years after the filing of the bankruptcy, whichever is later. Stanley v. Trinchard, 579 F.3d 515, (5th Cir. 2009).

The language about the trustee commencing the action should not raise concern with you or with your personal injury (or other such) attorney.  The trustee will always keep the original attorney that was hired by the client for the associated case. Never do Trustees handle personal injury or other cases themselves.  Being able to have 2 years added to the statute of limitations can be a huge advantage!

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