Back in October, T-Boz (born Tionne Watkins), a singer from the group TLC, filed for Chapter 13 bankruptcy protection. Last week, though, T-Boz had her case dismissed by the bankruptcy court, meaning that the singer’s creditors are legally free to pursue any and all claims against her.
Here’s a look at what went wrong with T-Boz’s bankruptcy filing, and what you can do to make sure your case proceeds more smoothly.
In Bankruptcy Court, Follow the Rules
There’s a reason that the U.S. Courts recommend working with a bankruptcy lawyer during a personal bankruptcy filing: the laws that govern the bankruptcy court are complex and outlined in difficult-to-decipher legalese. T-Boz, it seems, failed to follow the rules adequately. Here’s what happened.
- The bankruptcy petition. T-Boz filed a petition under Chapter 13 of the U.S. Bankruptcy Code, seeking a chance to repay her creditors over a period of three to five years. After filing the initial paperwork with the bankruptcy court, bankruptcy filers have a limited period of time in which to submit supplementary documents and paperwork. Failure to do so could result in the court dismissing your case.
- The repayment plan. Within 30 days of filing an initial petition, Chapter 13 filers are required to make the first payment according to the repayment plan they submitted. Those who don’t make this payment risk losing the court’s protection. T-Boz apparently listed more than $768,000 in debts, but made no effort to submit her first payment after filing her bankruptcy petition.
- The creditors’ meeting. Roughly 45 days after filing a bankruptcy petition, filers are required to attend the Creditors Meeting, at which they must attest to the truth and completeness of all information in their bankruptcy petitions. Creditors may attend this meeting (hence its name), but often do not. Because this meeting is required of all bankruptcy filers, those who do not attend risk having their cases dismissed. T-Boz, it seems, did not show up at her Creditors Meeting.
How to Keep the Bankruptcy Court’s Protection
Those who follow the rules of the bankruptcy court enjoy a powerful legal protection called the automatic stay, which prevents creditors of all types from making collection actions while a bankruptcy case is pending.
When the automatic stay is lifted, creditors are free to pursue debt collection by normal means. Because T-Boz failed to adhere to the rules set out by the bankruptcy court, she will now likely have to deal with collection actions from her creditors until she files for bankruptcy a second time, which she will be eligible to do 180 days after the dismissal of her original case.
Generally speaking, those who wish to avoid the unpleasantness of bankruptcy court dismissal may benefit from the guidance and instruction offered by a bankruptcy lawyer practicing in their state.
