Litigation Defenders

The Michigan Court of Appeals recently upheld a trial court’s granting of summary disposition against the plaintiff in a trucking-accident, bodily-injury claim after learning about the plaintiff’s statements in his personal bankruptcy case.

In Hernandez v Hires, No. 345229, 2019 WL 6171074, at *1 (Mich Ct App, November 19, 2019), the appellate court found the plaintiff held “contrary positions” in his lawsuit, “that he had a claim for damages arising out of the collision between the two trucks, while [his prior] position in the bankruptcy proceeding was that he had no claims against third parties, including any stemming from an accident.”

The appellate court reasoned that a “potential cause of action [for bodily injuries] constitutes an asset under bankruptcy law, [and] plaintiff’s failure to disclose the potential claim [in the bankruptcy proceeding] against defendants was contrary to the bankruptcy code which requires debtors to file a schedule of assets.”

In sum, the court ruled the plaintiff’s civil claims arising out of the truck accident were barred by a common-law doctrine known as “judicial estoppel,” which prevents a party from asserting a position in one legal proceeding that directly contradicts a position taken by that same party in an earlier proceeding.

This opinion is a good reminder that insurers and defendants should inquire into whether a party bringing or making a claim for bodily injuries has filed for bankruptcy which may reveal evidence  that would judicially estop the claimant from bringing such a cause of action.

A full copy of the court’s opinion can be found here.