Bankruptcy Killed His Injury Claim. Do Not Let It Kill Yours

The settlement mill lawyer treats your injury case like a sandwich order. Sign here, we will call you, next. He never asks what else is going on in your life. He never asks if you are behind on bills, if you are thinking about bankruptcy, if you have another lawyer handling something else. He does not connect the dots, because connecting dots takes time and time cuts into volume. And one dot he never connects is the one that quietly destroyed an entire injury claim in a real Mississippi case. The man had a real injury, a real demand, and a lawyer working his case. He still lost everything, and not because of the fall. Because of a single unchecked box in a different courthouse.

In Rehm v. Robinson Property Group LLC, decided by the Mississippi Court of Appeals, a man slipped and fell in a casino restroom and hurt his hip. He hired a lawyer. His lawyer sent a formal notice of the claim and later a written demand for eighty thousand dollars. This was a live, active personal injury claim being worked by counsel. So far this is an ordinary case. Then life happened. About six months after that demand went out, he filed for Chapter 7 bankruptcy and hired a separate bankruptcy lawyer to handle it.

Here is where it detonated. A bankruptcy filing requires you to list everything you own, and that includes claims against other people, whether or not you have filed a lawsuit yet. He answered no. His personal injury claim, the one his other lawyer was actively pursuing for eighty thousand dollars, never made it onto the bankruptcy schedules. He signed the petition under penalty of perjury. The bankruptcy court discharged his debts based on what he swore was true. Less than a year later he hired Mississippi counsel and filed the slip and fall lawsuit. The casino moved to throw the whole thing out, and the court did exactly that.

How A Bankruptcy Filing Quietly Kills A Personal Injury Claim

The trap has a name. Judicial estoppel. In plain English, the law will not let you swear one thing in one court and the opposite in another to suit whatever pays best that day. If you tell the bankruptcy court you have no claims against anybody, you do not get to turn around and sue somebody for the claim you just hid. The court applies a three part test. Was the new position the opposite of the old one. Did the first court rely on the old position. And was the inconsistency something other than an innocent accident. When all three line up, your lawsuit is dead on arrival, no matter how badly you were actually hurt in that restroom.

He tried to climb out of it. He argued it was inadvertent, that he simply followed his bankruptcy lawyer’s advice not to list the claim. His bankruptcy lawyer even signed an affidavit saying he had reviewed the claim, decided it was not worth pursuing, and told him to leave it off. It did not work. The court found he plainly knew about the claim, because his other lawyer had been chasing it for nearly a year with a written demand already on the table. And the court found he had a motive to hide it, because an undisclosed claim means money he keeps instead of money that goes to his creditors. Knowledge plus motive sank the inadvertence argument. The dismissal was affirmed. The injury never even got a trial.

The Bankruptcy Trap That Destroys An Injury Claim Is Completely Avoidable

Now sit with how avoidable this was. The fix did not require a genius. It required one lawyer who was paying attention to the whole client and not just the one slice of the case in front of him. The personal injury claim had to be disclosed. It could have been disclosed and protected. There are ways the law allows an injured person in bankruptcy to keep a claim alive and still come out the other side with a case worth pursuing. None of that happens if your injury lawyer treats you like a sandwich order and never once asks the questions that would have caught this before it became fatal.

I am not going to hand the defense bar a free checklist of exactly how this gets done right. They read these posts too, and they love nothing more than a plaintiff’s lawyer who gives the playbook away. What I will tell you is that the mistakes that destroy good cases are almost never about the wreck or the fall itself. They are about the things around it that nobody warned you about. I put those landmines, and how an injured person steps around them, in my free book. It is written plainly for people in Mississippi who are hurt and do not want a paperwork trap they never saw to wipe out a legitimate claim.

You are not committing to anything by reading it. No phone call required. No pressure. Get the book, learn where the traps are, and then decide what you want to do.

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If you were hurt because of someone else’s carelessness on the Mississippi Gulf Coast, you can read more about how I handle a Mississippi personal injury claim. The case discussed here is Rehm v. Robinson Property Group LLC, No. 2025-CA-00043-COA, decided by the Mississippi Court of Appeals. This article is commentary on a public appellate decision and general information, not legal advice about your situation.