Legal Question in Bankruptcy in Virginia

Can an Estate Administrator seek Bankruptcy Protection

Can an individual--who has been ordered by a circuit court, Individualy and as Admistrator of an Estate, to deposit funds into the Estate account which the individual, also a beneficiary of the Estate, converted to his own use after asserting without proof that the funds had been given to him by the deceased--claim that that he does not have any personal assets nor does he have a bond sufficient to comply with the court's order and, thereby, seek to have his debt to the other beneficiaries discharged in bankruptcy ? Can an Estate Administrator who fails to perform his fiduciary duties, seek protection under the bankruptcy laws ? If so, under which section of the applicable code would such debt incurred by a fiduciary for his benefit be dischageable?


Asked on 9/16/99, 9:19 pm

1 Answer from Attorneys
Daniel Press Chung & Press, P.C.

Re: Can an Estate Administrator seek Bankruptcy Protection

The estate administrator can seek bankruptcy protection. Unless affirmative steps are taken by interested parties, the debt will be discharged under the general section provinding that all debts are discharged, 11 USC 727(b). But debts incurred as a result of fraud or defalcation while acting in a fiduciary capacity are non-dischargeable under 11 USC 523(a)(4) if a Complaint to Determine Dischargeability is filed within the applicable time limit (60 days after the first meeting of creditors) and it is determined that the debt is in fact due to defalcation in a fiduciary capacity.

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Answered on 9/17/99, 8:17 pm


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