Bankruptcy Timing and the Holidays: Personal Injury Damages from Driving Under the Influence
Dec. 21, 2015
Even bankruptcy cannot help if you drink and drive, cause an accident, and hurt somebody, damage property, or are fined.
There are 3 different kinds of liabilities that can come from driving while intoxicated and getting into an accident: 1) personal injuries to others, 2) property damage, and 3) criminal traffic citation. Today we focus on the first of these.
Personal Injury or Death from Driving while Intoxicated
If you are in a traffic accident and you are injured and there’s not enough insurance to pay for your medical bills, usually you can file a bankruptcy and “discharge”—legally write off—those medical bills. If someone else is injured, you are found to be at least partially at fault, and your insurance doesn’t cover the other person’s medical bills, loss of employment income and any other such damages, you can usually discharge those liabilities by filing bankruptcy.
But not if you drink and drive and hurt somebody. You will not get financial relief from the bankruptcy laws.
The Bankruptcy Code has a list of the types of debts and liabilities excluded from discharge. It includes any debt:
for death or personal injury caused by the debtor’s operation of a motor vehicle, vessel, or aircraft if such operation was unlawful because the debtor was intoxicated from using alcohol, a drug, or another substance.
So if you operate a vehicle with a blood alcohol level above the legal limit and have an accident causing someone personal injury or death, bankruptcy will not “discharge” your liabilities from that injury or death. Such liabilities could total hundreds of thousands or even several million dollars in the case of a death.
Besides the grave harm caused to the other person, this is a potentially financial life-ruining event for you. You’d be weighed down by a huge debt that you could never get away from, even by using the usual tool of last resort for dealing with serious financial debts, the bankruptcy laws.
Chapter 7 and Chapter 13
There are a few kinds of liabilities that can’t be discharged through a Chapter 7 “straight bankruptcy” but can be discharged in a Chapter 13 “adjustment of debts after paying all that you can afford to pay of your debts for 3 to 5 years.
But not DUI/DWI debts. The law is clear that this exception to discharge applies to cases filed under Chapter 13 just as it does to those under Chapter 7. (See Section 1328(a)(2) of the Bankruptcy Code.)
Any Chemical Impairment Applies
This exception to discharge explicitly includes being “intoxicated from using alcohol, a drug, or another substance.” As long as the driving “was unlawful” as a result of the intoxication, the resulting personal injury liability won’t be covered by bankruptcy.
Drunk Boating or Flying
This exception to discharge also explicitly applies to injuries “caused by a debtor’s operation of a motor vehicle, vessel, or aircraft.” Again all it takes for the law to make such operation illegal—and it is illegal virtually everywhere to operate a boat or plane while under the influence.
There are plenty of reasons not to drink and drive. Particularly during the holidays it may help to have one more reason that you may have not have known about.
And besides possibly helping you, this information may be even more important to pass on to your friends and family, and help prevent someone from getting on the road impaired.