Will an Employment Contract`s payout survive bankruptcy?

February 19th, 2009 by Questions

I file bankruptcy May last year. I was getting my automatic discharge on Jan this year but I have not been able to pay the trustee so far. Before I filed for bankruptcy last year, I had an employment agreement with my employer. The agreement called for a large sum of money to be paid out to me if I was let go. I was fired and never got such payment. The trustee told me this contract was not an “asset” sense it only had value to me if I ever took the employer to court. (The agreement has a no transferable clause). He told me that if I took my ex-employer to court during my bankruptcy, then he would be first in line for anything I ever got. I never had money and I never took my ex-employee to court. After one year, things have changed and I might be able to take them to court to get my money.
If I take my ex-employer to court for a pre-existing employment agreement and if I get any money out of it:
1) Can either the creditors or trustee claim rights to the money if I get any?
2) Can the ex-employee claim the contract void because I was fired before my bankruptcy?
3) Sense I am not discharge yet, can I ask or do anything with the trustee to allow me to keep any revenue from this employment contract?

Posted from: Ontario


One Response to “Will an Employment Contract`s payout survive bankruptcy?”


This is a discussion you need to have with your trustee. As he is more familiar with exactly where your file sites it would be important for you to discuss it directly with your trustee.

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