Florida Bankruptcy Laws and Civil Judgment

by Patricia Dzikowski
Most civil judgments for consumer debt can be discharged in bankruptcy

Most civil judgments for consumer debt can be discharged in bankruptcy

David De Lossy/Photodisc/Getty Images

Most debt resulting from civil judgments -- such as judgments relating to consumer and business debt -- can be discharged when you file for bankruptcy in Florida. There are some exceptions, but those are mainly limited to judgments for fraud, domestic support obligations or intentional acts.

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Bankruptcy Overview

Although you may be filing for bankruptcy in Florida, bankruptcy is governed by federal not state law. Chapter 7 and Chapter 13 are the most common types of bankruptcy. If you file Chapter 7 bankruptcy, a trustee is appointed to collect and sell all non-exempt property-- that is, property that's not protected or excluded from being sold in bankruptcy. By contrast, a Chapter 13 bankruptcy results in a court-supervised repayment plan, in which you keep what you own but pay creditors all or a portion of the amount owed over 3 to 5 years.

Civil Judgments

A civil judgment is the end result of a lawsuit between two or more parties. If you are sued for failing to repay a debt or failing to pay for services provided, it could result in a civil judgment. A civil judgment can also result from lawsuits for damages, such as those due to accidents or contract disputes. Once a judgment is entered, if you don’t pay, the judgment creditor can attempt collection by obtaining court orders directing your wages or bank accounts to be garnished or property seized and sold.

Automatic Stay

As soon as you file bankruptcy, an "automatic stay" is put in place, meaning most creditors are prohibited from taking any further action to collect pre-bankruptcy debts. Although there are limited exceptions related to multiple bankruptcy filings, in most cases, the stay remains in effect and your exempt property is protected until your discharge is granted or a creditor obtains the court's permission to continue collections. During this time, creditors holding civil judgments - except for obligations exempted by the Bankruptcy Code, such as child or spousal support - cannot garnish your wages, freeze your bank account or seize your assets.

Discharge

If your debts are discharged, creditors of those debts are prohibited from taking any further collection action against you and their judgment is voided. If some of your debts are not discharged, however, those creditors can continue to pursue you for repayment. Civil judgments for fraud, death or personal injury resulting from driving under the influence, as well as civil judgments relating to willful and malicious acts, child support, spousal support or alimony, and student loan debt are generally not dischargable in bankruptcy. Certain civil judgments -- such as those relating to willful and malicious injury to property, debt incurred to pay non-dischargeable taxes, or money owed under a separation agreement or property settlement in a divorce are not discharged in Chapter 7 but may be dischargeable in Chapter 13.