McClure Law Group
  • Home
  • Contact
    • Contact Us
    • Bankruptcy Evaluation
    • Virtual Meetings
    • Upload Files
    • Blog
  • Practice Areas
    • Bankruptcy
      • Overview
      • Chapter 7
      • Chapter 11
      • Chapter 13
      • Facts
        • Foreclosure Defense / Rehabilitation:
        • Second Mortgage Lien Avoidance
        • Driver’s License Restoration
        • Student Loans
        • Personal Injury and Bankruptcy
        • Inheritances and Bankruptcy
        • Bankruptcy Eligibility for Discharge
      • Forms
    • Personal Injury
      • Truck / Auto Accidents
      • Slip and Falls
      • Dog Bite
        • Most Dangerous Dog Breeds
    • Elder Law (Trusts, Wills, Probate)
      • Wills
      • Trusts
      • Probate
      • Forms
    • Fair Credit Consumer Protection Act (FRCPA)
      • Forms
    • Fair Credit Reporting Act (FCRA)
      • Forms
    • Worker Compensation
      • On the Job Injury
      • Re-injury
      • Permanent Total Disability Benefit
      • Permanent Partial Disability Benefit
      • Pension
      • Third Party Liability
      • Forms
      • Links – Worker Compensation
    • Immigration Lawyer
  • Testimonials
  • About Us
    • Staff
      • Mark McClure – Managing Attorney
      • Ian Hatch – Bankruptcy Case Manager / Paralegal
      • Lorrie Judd – Litigation Support Paralegal
      • Maria Cruz – Interpreter / Paralegal
  • (253) 631-6484
  • No Obligation Consultation
  • Make Payment
  • Menu Menu

Practice Areas

Personal Injury and Bankruptcy

Have you been injured and have a possible claim against someone?  Has this put a financial burden on you and your family?  There are some tricky issues ahead of you and you want to talk with a seasoned bankruptcy / personal injury attorney.

Section 11 U.S.C.  522(d)(11)(D) allows a debtor to exempt up to $21,625 of compensation for “personal bodily injury.”   Excluded from the “personal bodily injury exemption” are payments attributed to “pain and suffering” and “actual pecuniary loss.”

Because “pain and suffering” and “actual pecuniary loss” encompass most measures of damages awarded for personal injury, courts have struggled to determine exactly what Congress intended the exemption to cover.  “If read literally it could be reasonably concluded from the plain language of the statue that there exists no meaningful exemption for personal injuries because of actual pecuniary loss and pain and suffering are excluded from exempt status, as the statute seems to say, there is really nothing left.”

Legislative history sheds no light on the scope of the “personal bodily injury” exemption.   The Judiciary Committee notes state that Section 522(d)(11)(D) is designed to cover compensation for “actual bodily injury,” but is not intended to include the attendant costs that accompany such loss, such as medical payment, pain and suffering, or loss of earnings:
This provision in subparagraph (D)(11) is designed to cover payments in compensation of actual bodily injury, such as the loss of a limb, and is not intended to include the attendant costs that accompany such loss, such as medical payment, pain and suffering, or loss of earnings.  Those items are handled separately by the bill.

H.R.Rep. No. 95-595, 95 Cong., 1st Sess. 361-362 (1977), U.S. Code Cong. & Admin. News 1978, pp. 5693, 6318.  Adding to the confusion is Congress’ failure to provide for the excluded items.

Convinced that Congress did not intend to create a useless exemption, Courts have relied on the statute’s context-the Bankruptcy Code-and on the Code’s underlying policies, purposes and goals, to “arrive at a proper interpretation.”   The Bankruptcy Code’s policies, purposes and goals include:

  1. To provide the debtor with property necessary for survival;
  2. To protect the dignity and the cultural and religious identity of the debtor;
  3. To enable the debtor to rehabilitate himself [or herself] financially and earn income in the future;
  4. To protect the debtor’s family from the adverse consequences of impoverishment; [and]
  5. To shift the burden of providing the debtor and his family with minimal financial support from society to the debtor’s creditors.

Alan N. Resnick, PRUDENT PLANNING OR FRAUDULENT TRANSFER?  THE USE OF NONEXEMPT ASSETS TO PURCHASE OR IMPROVE EXEMPT PROPERTY ON THE EVE OF BANKRUPTCY, 31 Rutgers L.Rev 615, 621 (1978).  As pertains specifically to the personal bodily injury exemption it has been said:

The purpose of an exemption for monies payable in the event of personal injury is two-fold.  One purpose is to prevent debtors and their families from becoming financially dependent upon the state.  However in the case of the personal injury exemption, an even more fundamental purpose is served.  The personal injury exemption is a legislative attempt to restore human capital; to preserve money that makes an injured debtor whole in the eyes of the law.

In re Butcher, 189 B.R.357, 365 (Bankr.D.Md. 1995)(citing American Service Corp of South Carolina v. Hickle, 435S.E.2nd 870, 871 (SC 1993).

Given these public policies, Courts construe the exemption in favor of the debtor.   Thus, Courts give the term “personal bodily injury” a broad and liberal construction.   As long as it appears from the facts that the claimed personal injury award could reasonably fall within the exempt category the court may allow it.   On the other hand, Courts construe the terms “pain and suffering’ and “actual pecuniary loss” a narrowly.   Under the narrow construction accorded to “actual pecuniary loss,” the objector must establish that the Settlement Agreement expressly designates a portion of the settlement proceeds to that category.

And, under the narrow construction accorded to the term “pain and suffering,” the majority of Courts hold that the exemption excludes “pain and suffering” only to the extent that “pain and suffering” are strictly for emotional trauma or mental distress.   “It has been suggested that Congress, in drawing a clear distinction between recover for bodily injury and for pain and suffering intended only mental and emotional trauma, as opposed to physical discomfort and distress, to fall under the category of pain and suffering.”   The “statute’s apparent purpose is to prevent exemptions based solely on pain and suffering unaccompanied by bodily injury.”  (emphasis added)  Mental or emotional trauma that can be categorized as excluded pain and suffering are “fright, shock, stress, aggravation, embarrassment, humiliation, depression, nervousness or anxiety.   Any recovery received for physical manifestations of pain and suffering, such as physical discomfort or physical distress, is exempt.

These three concepts are the building blocks of the “personal bodily injury” analysis; and Rule 4003 provides the analytical framework.  Rule 4003 places upon the objecting party both the initial burden of production and the ultimate burden of persuasion in any controversy regarding the legitimacy of claimed exemptions.   Because the objecting party has had the initial burden of production, the debtor establishes the exemption’s prima facie validity merely by claiming it.   “A debtor is not required to make an affirmative showing that a claimed exemption is appropriate.”  As long as the debtor expressly or impliedly characterized the settlement as falling within an exempt category, the [objector] retains the burden of proof and must present evidence to the court if he wishes to prevail on his objection.”

Once the debtor claims the exemption, the burden shifts to the objector to rebut the presumption of validity.   “It is the consensus among the overwhelming majority of the courts having faced this issue that compensation designated purely for ‘personal bodily injury’ is exempt ‘so long as the money is specifically not intended as compensation for pain and suffering or actual pecuniary loss or that the damages are not way out of proportion to the injuries.   “[J]ust because the Debtor ha[s] financial losses arising from the [an] incident, it does not necessarily follow that the payment made to the Debtor…w[ere] not on account of  bodily injuries.”   Likewise, just because the debtor experienced mental anguish and emotional distress, arising from the incident, it does not necessarily follow that the payment made to the debtor are excluded from the exemption for personal bodily injuries.

In other words, the objector can overcome the presumption of validity by establishing one or more of the following by a preponderance of the evidence: (1) that there has been no cognizable physical injury to the body; (2) that the Settlement Agreement expressly allocates portions of the award to the Section 522(d)(11)(D) exclusions; or (3) that the damages awarded are way out of proportion to the actual physical injury.

If you have a personal injury and need to file bankruptcy or already have, give attorney Mark McClure a call at 253-631-6484 to ensure your rights are being protected.

Personal Injury

Unfortunately, insurance companies are only interested in their bottom line, and will do everything they can to protect it – even at the cost of your health and financial security. Our Kent personal injury attorneys will make sure that your legal rights are protected, and will fight against the unfair practices that insurance companies regularly employ.

You might think that because you’ve been a loyal customer to your insurance company for years that they will take care of you in your time of need. Many make this same mistake, and find themselves buried in medical bills years later with no recourse for compensation.

Don’t let this happen to you – contact one of our Kent personal injury lawyers before you agree to any terms with your insurance agent. Your accident will likely lead to medical bills, lost wages, and emotional stress that can be difficult to mitigate. Don’t allow someone else’s negligence to force you to sacrifice your financial stability, your health, or the future prospects for members of your family.

Contact our office today and talk to a qualified professional about your case, and we will explain how we might be able to help. We are experienced litigators who will fight for fair compensation in your Kent personal injury case.

Call Now or Enter Your Info Below for Your FREE Case Analysis

Simply enter your info below or call (253) 631-6484 so we can help get creditors off your back, and get you back on track.

     

    Contact Your Local Kent Bankruptcy Attorney Today!

    We Are Professional Bankruptcy Attorneys And We Will Solve Your Creditor Problems.

    Call now and speak with one of our bankruptcy attorneys and we will fight for you to help you start over and build a new life without all the threatening phone calls.

    This consultation is absolutely free and we will answer any and all questions you may have.

    Video

    PERSONAL INJURY QUICKLINKS

    Auto Accidents, Truck Accidents & Motorcycle Accidents

    Slip and Fall

    Dog Bite

    Most Dangerous Dog Breeds

    Learn More

    BANKRUPTCY

    Overview

    Chapter 7

    Chapter 13

    Chapter 11

    Facts

    Learn More

    WILLS AND TRUSTS

    Wills

    Trusts

    Probate

    Learn More

    PERSONAL INJURY

    Auto / Truck Accidents

    Slip and Falls

    Dog Bite

    Most Dangerous Dog Breeds

    Learn More

    MEDICAL MALPRACTICE

    Standard of Care

    Expert Witnesses 

    Subrogation

    LEARN MORE

    We are the best reviewed Bankruptcy, Personal Injury, and Probate Law Firm in the US.

    If you want to be represented by the best law firm for your case then do not hesitate and write us a mail!

    Get in touch

    Service Areas

    Bankruptcy

    Auburn

    Black Diamond

    Bonney Lake

    Burien

    Covington

    Des Moines

    Federal Way

    Fife

    Kent

    Lea Hill

    Maple Valley

    Milton

    Pacific

    Puyallup

    Renton

    Seattle

    Seatac

    Sumner

    Tacoma

    Tukwila

    Personal Injury

    Auburn

    Black Diamond

    Bonney Lake

    Burien

    Covington

    Des Moines

    Federal Way

    Fife

    Kent

    Lea Hill

    Maple Valley

    Milton

    Pacific

    Puyallup

    Renton

    Seattle

    Seatac

    Sumner

    Tacoma

    Tukwila

    Probate

    Auburn

    Black Diamond

    Bonney Lake

    Burien

    Covington

    Des Meoines

    Federal Way

    Fife

    Kent

    Lea Hill

    Maple Valley

    Milton

    Pacific

    Puyallup

    Renton

    Seattle

    Seatac

    Sumner

    Tacoma

    Tukwila

    L & I

    Auburn

    Black Diamond

    Bonney Lake

    Burien

    Covington

    Des Moines

    Federal Way

    Fife

    Kent

    Lea Hill

    Maple Valley

    Milton

    Pacific

    Puyallup

    Renton

    Seattle

    Seatac

    Sumner

    Tacoma

    Tukwila

    Disclaimer :
    This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. Mark McClure is licensed to give legal advise in the state of Washington only.

    Private Policy Statement:
    Law Office of Mark McClure, PS will not sell or rent to anyone the information you provide us. The Law Office of Mark McClure, PS is a law firm and must protect client confidentiality and the attorney-client privilege.

    mcclure

    Home | Services| Sitemap | Contact

    Copyright © 2012-2019 McClure Law Group. All Rights Reserved.
    1103 W Meeker St #101 Kent, WA 98032 • (253) 631-6484

    Scroll to top

    This is a notification that can be used for cookie consent or other important news. It also got a modal window now! Click "learn more" to see it!

    OKLearn More

    Cookie and Privacy Settings



    How we use cookies

    We may request cookies to be set on your device. We use cookies to let us know when you visit our websites, how you interact with us, to enrich your user experience, and to customize your relationship with our website.

    Click on the different category headings to find out more. You can also change some of your preferences. Note that blocking some types of cookies may impact your experience on our websites and the services we are able to offer.

    Essential Website Cookies

    These cookies are strictly necessary to provide you with services available through our website and to use some of its features.

    Because these cookies are strictly necessary to deliver the website, refuseing them will have impact how our site functions. You always can block or delete cookies by changing your browser settings and force blocking all cookies on this website. But this will always prompt you to accept/refuse cookies when revisiting our site.

    We fully respect if you want to refuse cookies but to avoid asking you again and again kindly allow us to store a cookie for that. You are free to opt out any time or opt in for other cookies to get a better experience. If you refuse cookies we will remove all set cookies in our domain.

    We provide you with a list of stored cookies on your computer in our domain so you can check what we stored. Due to security reasons we are not able to show or modify cookies from other domains. You can check these in your browser security settings.

    Other external services

    We also use different external services like Google Webfonts, Google Maps, and external Video providers. Since these providers may collect personal data like your IP address we allow you to block them here. Please be aware that this might heavily reduce the functionality and appearance of our site. Changes will take effect once you reload the page.

    Google Webfont Settings:

    Google Map Settings:

    Google reCaptcha Settings:

    Vimeo and Youtube video embeds:

    Accept settingsHide notification only