I'm Divorced. My Ex says my bankruptcy doesn't protect me from "indemnification" or hold harmless debts? What is that?

If you are divorced, and as part of the divorce decree you agreed to pay certain debts (other than child or spousal support), and you agreed to "indemnify" or "hold harmless" your spouse if you did not pay them, then if you file chapter 7 bankruptcy, if your ex pays them, she can sue you for what she had to pay.

For example: Say in the divorce, you had a joint credit card account with Chase that you agreed to pay (or were ordered to pay by the divorce court). If you also agreed (or were ordered) to indemnify and hold your ex-wife harmless as to the debt, and then you don't pay it, even if you file chapter 7 bankruptcy, and she pays it, she can sue you for it. Your debt to her is not discharged. Your debt to Chase IS discharged; they cannot sue you for it.

So pay attention, for this to come into play: (1) you must have been ordered to pay the debt in connection with a divorce or separation agreement or other court of record; (2) you must be in chapter 7 instead of 13; (3) your ex (or your spouse or child) must have actually paid the debt; and (4) as a practical matter, they must also be liable on the debt, or they likely would not have had to pay it in the first place.

Actually, these kinds of debts are not discharged as to you in chapter 7, at all. Your spouse, ex-spouse or child does not need to file an objection with the Bankruptcy Court. If you think this will cause you problems, you may want to consider filing Chapter 13.

J Thomas Black
Board Certified, Consumer Bankruptcy Law- Texas Board of Legal Specialization