I don’t really want to talk about death but everyone dies whether we like it or not. Blame Adam for that. If Adam did not eat of the forbidden fruit in Paradise, then we would still have the superior body that never gets sick and never dies. But we are forever indebted to Jesus, the son of the one true God, the God of Moses and Israel, my God, for becoming man and dying on the cross so that we can have eternal life with them in Paradise once more. It is the blood of Jesus that washes away our sins and allows us to be reborn and enter heaven.

Recently I had two clients who died after their Chapter 7 bankruptcy was filed. In the first case, the debtor was a young man of 40. He was a perfectly healthy man who worked out every day, happily married for 5 years, owned a house with $120,000 of equity, and ran a small business. He had some credit card debt, not much. He decided to go on a vacation with his wife to an island paradise in the Caribbean. It was to be a two-week vacation, relaxing and having fun in the sun with their 4-year old son. On the third day on the island, he starts to get flu like symptoms which gets worse and worse. He is brought to the hospital which diagnoses his symptoms as just an ordinary case of influenza. On the 2nd day in the hospital, the diagnosis is changed to pneumonia. He has hard time breathing. Wife decides to fly him back to San Diego. The hospital bill plus the cost of flying back to San Diego costs $30,000. They have no medical insurance. For the first week of medical treatment in San Diego, the cost is $300,000. Wife signs a guarantee for the medical bill. Wife sees me because she says there is no way that they can pay that bill. Does it make sense to file for Chapter 7 relief at this point? Sure it does.

If they file for bankruptcy at that point in time, all their unsecured debt, including the $300,000 incurred in San Diego and the $30,000 incurred on the island will be discharged. At the same time, the bankruptcy will protect the $120,000 of equity in their house. So, with a Chapter 7 discharge, they can keep their house and other assets, including the small business that they run, while getting rid of $330,000 of medical bills. A week after we file the bankruptcy, husband slips into a coma and dies. I know young people in their forties do not think of dying, but the fact is death does come like a thief in the night and does not discriminate between old or young. One day you’re perfectly healthy with no worries, the next day, your face to face with Jesus, your creator, Lord and Sovereign.

Death does not end the bankruptcy proceeding as long as the case is filed before the date of death. Wife will appear at the 341a meeting of creditors and be examined by the trustee to testify as to their financial matters. A death certificate must be presented to the trustee who will still administer the bankruptcy estate despite the death of debtor. We inform the trustee that new hospital bills amounting to another $80,000 have come in and schedule F will be amended accordingly. There is a big advantage to the wife who is left behind. She is able to keep the house, all their assets and their business but she does not have to pay the hospital bills which have now reached $400,000. Her personal guaranty to answer for all the medical bills of her husband will be discharged. Husband’s credit card debt of $40,000 will also be discharged. Without the pre-death bankruptcy, creditors and the hospital will sue the husband’s estate in probate court for $400,000.

We will discuss the 2nd case next week. “And the Lord God said to the woman, “What is this you have done?” The woman said, “The serpent deceived me, and I ate.” – Genesis 3:13.