Lawsuits in Richland, Washington: Your Rights and What to Expect

Lawsuits and bankruptcies in Richland, Washington, are two legal processes that people and businesses can encounter during financially challenging times. Both are governed by state and federal law.

Let’s explore the relationship between lawsuits and bankruptcy, provide some insight into the laws and statutes involved, and offer you some valuable guidance when you find yourself seeking out bankruptcy relief or dealing with lawsuits in Benton County or the Tri-Cities area.

As a part of the Tri-Cities area, Richland is home to a mix of industries, from technology and agriculture to healthcare, all of which can also be affected by financial struggles. So, whether you’re dealing with business debts or personal financial hardship, you will find that both lawsuits and bankruptcy are governed by state and federal law.

Our experienced Richland bankruptcy attorneys can help you explore the connection between these two while outlining relevant laws and statutes and guiding you through the process.

Lawsuits involve legal actions taken by one party against another as a way to resolve disputes that often happen over things like financial issues, breaches of contract, or other civil matters.

On the other hand, bankruptcy is a legal process that allows you to reorganize or discharge debt under the court’s protection. When lawsuits and bankruptcies intersect, the outcome can greatly affect your financial future.

Richland, located in Benton County and considered a part of the Tri-Cities, operates under Washington state law. This, in turn, also follows federal bankruptcy regulations, specifically the US Bankruptcy Code. Understanding these frameworks and legalities is important when dealing with bankruptcies and lawsuits.

Some of the more common types of lawsuits you might encounter include:

• Breach of Contract: Legal action taken when one party fails to fulfill the terms of a contract
• Personal Injury: Lawsuits arising from accidents or negligence that cause harm or injury
• Debt Collection: Lawsuits filed by creditors to collect overdue debt, including credit card debts, mortgages, and personal loans

Washington also follows a statute of limitations when it comes to filing these lawsuits, which varies depending on the type of claim. For example, debt collection lawsuits need to be filed within six years from the date of the debt default.

If you are in Washington and looking for relief from your debt, you may have considered filing for bankruptcy. There are two types commonly filed:

• Chapter 7 Bankruptcy (Liquidation): Chapter 7 allows you to discharge most of your unsecured debts, including your credit card balances and medical bills. This is done by liquidating non-exempt assets.
• Chapter 13 Bankruptcy (Reorganization): Chapter 13 allows you to reorganize your debts into a manageable repayment plan over three to five years. This option is ideal if you want to keep your assets.

One of the biggest intersections between lawsuits and bankruptcy is when a lawsuit is filed against someone already facing financial difficulties. The outcome of a lawsuit can ultimately influence the decision to file for bankruptcy or not. Here’s a quick breakdown of how lawsuits and bankruptcies can eventually cross each other’s paths.

In some cases, you can file for bankruptcy before a lawsuit is even filed. This is usually done to prevent your creditors from taking legal action to collect on those debts. Once your bankruptcy petition is filed, an automatic stay goes into effect, preventing your creditors from pursuing lawsuits and other collection actions while the bankruptcy process is active and ongoing.

You may want to seek bankruptcy relief if a lawsuit has already been filed against you and you can’t resolve the issue through court. In these cases, the bankruptcy court might discharge or reorganize your debts that are associated with the lawsuit. However, it does come down to the specifics of your case.

Here are a couple of examples:

• Dischargeable Debts: Most unsecured debts that result from lawsuits can be discharged through Chapter 7 bankruptcy.
• Non-Dischargeable Debts: Certain types of debt, such as child support, alimony, and student loans, are not dischargeable through bankruptcy. If the lawsuit involves these types of debts, bankruptcy may not provide relief.

One of the most common reasons for filing for bankruptcy in the Tri-Cities region is to stop debt collection lawsuits from happening. If a creditor has filed a lawsuit to collect a debt, then you may seek bankruptcy protection to stop further legal proceedings. This is particularly useful in preventing wage garnishments, property seizures, or bank account levies.

When you file for bankruptcy in Washington, you need to understand the state’s exemptions, which determine what property you can keep when filing. The state lets you choose between state and federal exemptions:

• Homestead Exemption: Up to $125,000 of equity in a home
• Personal Property: Items such as clothing, household goods, and personal effects are exempt up to certain dollar amounts
• Retirement Accounts: Funds in qualified retirement accounts, such as 401(k)s and IRAs, are generally protected

Both bankruptcy and lawsuits can have a negative impact on your credit score. A bankruptcy will remain on your credit report for up to 10 years, while a lawsuit judgment can stay on your credit report for up to 7 years. However, filing for bankruptcy may provide relief from overwhelming debt and give you a chance to rebuild your credit.

If you lose a lawsuit and find you can’t pay the judgment, the creditor may attempt to collect the debt through wage garnishment, bank levies, or liens on your property.

Bankruptcy may discharge some tax debts, but this depends on specific conditions:

1. The taxes must be income taxes.
2. The tax return must have been filed at least two years before filing for bankruptcy.
3. The tax debt must be at least three years old.
4. The tax assessment must be at least 240 days old.

If these criteria are met, the tax debt may be dischargeable in Chapter 7 or Chapter 13 bankruptcy.

Lawsuits related to fraud can have some unique implications in bankruptcy. While filing for bankruptcy will temporarily stop the lawsuit through the automatic stay, debts arising from fraud or willful misconduct are often non-dischargeable. The creditor may challenge the discharge of these debts during your bankruptcy process.

Once your debts have been discharged in bankruptcy, your creditors can’t sue you for those debts. However, this protection only applies to those debts you included in your bankruptcy filing. If there are any new debts after your bankruptcy or if non-dischargeable debts are left over, your creditors can then take legal action on these.

When looking for a Richland bankruptcy attorney, you want to verify they have experience in bankruptcy law. You then want to check reviews and testimonials from past clients, ensure clear communication and transparent fees, and confirm their knowledge of and expertise on local laws.

Filing for bankruptcy can be a stressful process. Because it involves navigating the legal requirements and understanding how your debts and assets will be impacted, having a skilled Richland bankruptcy attorney by your side is absolutely essential.

Here are some key reasons why you must consult a bankruptcy attorney in Richland, Washington:

• They know Washington state and federal bankruptcy laws
• They can offer personalized advice based on your unique case
• They offer protection against mistakes
• They can guide you through the automatic stay process
• They can represent you and your best interests in court and negotiations
• They can assist you with lawsuit judgments
• They improve your overall chances of case approval
• They offer you greater peace of mind so you can focus on rebuilding your life

So, if you find yourself feeling overwhelmed by debt, facing a lawsuit, or considering bankruptcy in the Tri-Cities area, consult with your Richland bankruptcy attorney early on in the process so they can provide you with clarity, protect your rights, and guide you to the best resolution possible for your situation.

Partnering with a knowledgeable bankruptcy attorney in Richland is the first step toward financial freedom. Their expertise and local insight can make all the difference in achieving a successful outcome while protecting what matters most to you.