Bankruptcy provides relief for many clients with debt resulting from a car accident. In many cases, these debts stem from a lack of insurance and property damage, and even in others, the debt itself relates to a personal injury lawsuit after a car accident. These debts following a car accident are often dischargeable, but in some cases, bankruptcy will provide no relief. Specifically, debts for personal injury or death resulting from the operation of a motor vehicle while intoxicated are not dischargeable in bankruptcy.
The Bankruptcy Code in no uncertain terms excepts DUI personal injury damages from discharge. The statute reads:
A discharge under… this title does not discharge an individual debtor from 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.
Why Did Congress Exclude Drunk Driving Personal Injury Debts From The Bankruptcy Discharge?
In addition to criminal laws penalizing drunk driving, Congress sought to protect drunk driving personal injury victims by excluding such civil judgments from the bankruptcy discharge. In the words of In re Hudson:
“We think it evident that Congress sought three objectives when it adopted § 523(a)(9): (1) to deter drunk driving; (2) to ensure that those who caused injury by driving drunk did not escape civil liability through the bankruptcy laws; and (3) to protect victims of drunk driving.”In re Hudson, 859 F.2d 1418, 1423 (9th Cir. 1988)
What The Creditor Must Prove
To except the debt from the bankruptcy discharge, “the creditor must establish that the debt resulted from (1) a death or personal injury, (2) caused by the operation of a motor vehicle by the debtor, and (3) the unlawfulness of the operation because the debtor was intoxicated from using alcohol, a drug, or another substance. ” In re Felski, State of Michigan v. Felski, No. 01-CV-10272-BC, (E.D. Mich. May. 13, 2002)