Chapter 13 Bankruptcy and Inheritance.

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Q. Under the chapter 13 provisions, does the court have the right to claim his inheritance? And, If he were to deposit his inheritance and not touch it without notifying the court, would he be in violation of any law and subject to arrest/fines/etc.?

A. Bear in mind that in using the Bankruptcy code, the 100's, 300's, and 500's are only effective so long as the reorganization and discharge chapters don't have their own version. Therefore, chapter 13 controls. If he were to deposit his inheritance and not touch it without notifying the court, would he be in violation of any law and subject to arrest/fines/etc.? -See Title 28. I believe this one is fine, rather than arrest, but then, don't quote me. Everybody does things like this. Doesn't make it right or legal, but he certainly wouldn't be alone. To me, the question is, why should I, as a lawyer who worked pretty hard for the right to represent people as an attorney at law, help a total stranger evade the apparent letter of the bankruptcy law, when this guy doesn't even want to confide in his own attorney? An attorney has a duty of confidentiality which generally prevents him from turning in a client, although he does have a duty to try to prevent "fraud on the court" and "remonstrate" with the client to do the right thing. If what your friend wants to do it OK, then his lawyer won't have a problem with it.

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