Kentucky Bankruptcy Law

Counsel with Care

“Do you know how fast you were going?”

Long title, and I know it does not seem to have a thing to do with bankruptcy, but bear with me. Oh, and no I have not been pulled over lately, but in the past I have seen those flashing blue and red lights in my rear view mirror a time or two. It always perplexed me as to why the first thing the officer would ask was, “Do you know how fast you were going?” Now, after tens of thousands of dollars in student loans, I believe I have the answer.

There is a rule of evidence that allows statements a party to a criminal or civil proceeding made outside of the courtroom to come into evidence. Ordinarily such statements are “hearsay” and are not admissible. However, an “admission” by a party opponent can come in as evidence because the rule makers figured there is enough reliability to them, with the alleged maker of the statement right there to rebut the “admission”, to allow such statements in.  So, when you answer the police officer, you are making an “admission” which is an exception to the rule against hearsay as evidence.

If you say, “Why yes I do know. I was going pretty near the speed of light and it was merely fortuitous that your red and blue lights even caught up to me.” That is an admission of guilt.  If you say, as most people do, “No sir, I really haven’t the foggiest idea how fast I was going. I just lay the hammer down, bro.”  Well, that too is an admission. You are admitting that you cannot refute whatever speed they say you were going. On the outside chance that you are so bored as to ask for a trial over the speeding ticket, you will not be able to testify that you actually do know how fast your were going without the police officer damaging your credibility by repeating your admission that, “I don’t know.”

The only helpful answer to this question would be if you actually did know how fast you were going and it actually was within the speed limit. The convergence of these two events at one point in time is exceedingly rare, and the police know it. I suppose you could try to be smart and say, “Well, since the earth rotates west to east at 1,000 miles per hour (adjust for your latitude of course) and I was driving east to west at 35 miles per hour, then I was actually going 965 miles per hour backwards.” But, I doubt it will win you any prizes.

So, what does this have to do with bankruptcy. Well, at the meeting of creditors you are going to be asked questions under oath. Your answer to these questions are admissions. Not only are they admissions, they are sworn statements so you cannot even rebut them the way you would a non-sworn admission. Because of this, it is best to be honest or, like your admission of “I don’t know” to the speeding question, it could be used against you.

One basic question that some trustees ask is “Why did you file bankruptcy?” This seems as innocuous as the police officer asking, “Do you know how fast your were going?” Do not be fooled; neither one is trying to make polite small talk with you. This question is designed to elicit information that you may not have thought to tell your attorney. For example, if you filed bankruptcy because you went out on a manic spending spree buying a bunch of luxury goods and services, the meeting of creditors is not the best time to divulge that information. If you were injured due to the negligence of another driver or perhaps a physician made an error that left you out of work for a long time, those are causes of actions for lawsuits and the trustee now has them as assets of the estate (unless you can exempt them).

However, if your honest answer to the question of why you filed bankruptcy was that you were laid off, bills just started piling up, or even that you were not as careful as you should have been with spending, well those answers would not cause the trustee any consternation. Be sure to discuss the why of filing bankruptcy with your attorney so they can help figure out any of these potential trouble areas in advance and plan for them.


June 18, 2012 - Posted by | Bankruptcy, The estate | , , , , , , , , , ,

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