West v. Young
Justice Thomas Whelan
West sued to recover damages from personal injuries sustained in a motor vehicle accident. Before the accident, she filed a Chapter 13 bankruptcy proceeding. Defendants moved to amend their answer to include the affirmative defense of lack of capacity to sue allegedly arising from the fact that this action was an asset of the bankruptcy estate over which only the trustee may act. The court stated that in contrast to Chapter 7 proceedings, to discharge debt, the object of a Chapter 13 filing was the rehabilitation of the debtor under a plan adjusting debts owed to creditors by the debtor's regular payments derived from income. Thus, there was no real disconnect of the estate property from the debtor under a Chapter 13 filing, unlike Chapter 7 cases, except to the extent that the plan placed control over an asset in the trustee's hands. Hence, while Chapter 7 and 11 debtors lose standing to maintain civil suits, which must be brought or maintained by their bankruptcy trustees, Chapter 13 debtors are not subject to this restriction. As West had standing to prosecute non-bankruptcy causes of action, the court denied defendants' application to amend their answer as the defense was patently devoid of merit.