Michigan Court of Appeals Confirms That False Bankruptcy Petition Can Preclude Tort Action Based on Judicial Estoppel

Where a Plaintiff files a bankruptcy action and later files a personal injury lawsuit based on a pre-bankruptcy incident, the failure to disclose the personal injury claim on the bankruptcy petition will preclude the personal injury lawsuit based upon the defense of Judicial Estoppel.  In Hernandez v. Atlas Roofing Company, the trial court granted ruled that the Plaintiff’s lawsuit was barred by the doctrine of judicial estoppel because Plaintiff had not disclosed the pre-bankruptcy claim on his bankruptcy petition.  On appeal, the Cardelli firm persuaded the Michigan Court of Appeals to affirm this result, recognizing that judicial estopped may only be avoided if there is prompt amendment of the bankruptcy petition, but that Plaintiff’s delayed and ineffective efforts fell well short of same.

The matter was handled for the Cardelli firm by Robert Kaatz at the trial court level, and Jason Newman and Anthony Caffrey at the appellate level.  If you have any questions regarding the decision, please feel free to contact them.