When I was a kid, Jose Conseco was THE MAN in baseball. He was rookie of the year in 1986. In 1987, he was joined by fellow ‘bash brother’ Mark McGwire, who was the 1987 rookie of the year. In 1988 he led the A’s into the Word Series with a .307 batting average, 120 runs scored, 124 RBI, 42 home runs, and 40 stolen bases. 

However, as with many sports stars, Canseco was not very good at managing his money. It is estimated that from 1986-2000 Canseco grossed over $45 million. On July 31, 2012 Canseco filed for Chapter 7 bankruptcy. While it is interesting to gloss over Canseco’s career and wonder how on earth someone who earned (on average) over $3 million per year could possibly file for bankruptcy, what is more interesting are the types of debt that Canseco is attempting to eliminate through bankruptcy. 

I think its common knowledge that not all debts are discharged through bankruptcy. You cannot get out of paying child support or alimony through bankruptcy. You also cannot get out of paying some taxes, and your student loans (unless you can prove undue hardship). In fact, the bankruptcy code lists some 20-odd ‘exceptions’ to the bankruptcy discharge. 

The tentative problem with Canseco’s bankruptcy discharge is listed in this articlein the Washington Times. The articles states that Canseco’s bankruptcy filing was “very likely motivated by his desire to avoid paying a $785,344 judgment to Christian Presley. A Florida trial court awarded Presley the judgment against Canseco and his brother based on injuries that Presley sustained in a fight with the Cansecos in a Miami nightclub in 2001. Canseco appealed and lost.”

The bankruptcy code states debts “for willful and malicious injury by the debtor to another entity or to the property of another entity” is non-dischargeable through bankruptcy. This means, the debt is not included in the bankruptcy discharge. But it’s not automatic. The injured person must file a lawsuit inside the debtor’s bankruptcy case (called an adversary proceeding) asking the bankruptcy court to allow the debt through the bankruptcy. Debts arising from negligence, however, (like auto accidents) are not within the scope of this exception and are generally dischargeable.  And filing a lawsuit costs money that many judgment creditors just don’t have.  

In essence- if you have been sued and have a judgment against you- then your bankruptcy will cover the underlying debt and the judgment will be unenforceable. What you need to worry about, is if the judgment was received out of some sort of intentional injury that you caused upon another person. The best way to find out if your judgment will be included in your bankruptcy is to talk to an experienced bankruptcy attorney.