Delaware Bankruptcy Law (DE)
If filing Chapter 7 or Chapter 13, all debtors must disclose potential claims
In both Chapter 7 bankruptcy and Chapter 13, all claims and potential liabilities must be accurately reported to the court with official schedules. For the most part, commercial credit transactions are fairly easy to classify, yet potential claims and causes of action pose a more difficult problem.
Consider an example. Following an automobile accident, insurance companies most often settle claims for property damage quickly. Yet the topic of personal injuries, unless asserted by an opposing party, as seldom discussed out of fear of creating potential claims. Nevertheless, a potential personal injury claim may be asserted in the future, and the integrity of the claim and resulting liability will be determined under Delaware state law. If filing Chapter 7 or Chapter 13, debtors should disclose this potential claim. Inclusion guarantees administration by the court, whereas an omitted claim is not subject to discharge. When in doubt, all potential claims should be included.