In Berryman v Zurich Australia Ltd [2016] WASC 196 it was decided that a bankrupt's entitlement to claim a TPD benefit under a life insurance policy is not an entitlement that is divisible amongst the bankrupt's creditors, and therefore such an entitlement does not vest in the Official Trustee in bankruptcy. Tottle J of the Supreme Court of Western Australia ruled that the bankrupt insured could continue an action in his own name to recover the TPD benefit. Life insurers may need to adjust their claims' payment practices in light of the Berryman decision.

Borrowers who file a bankruptcy petition are always looking for creative new challenges to claims asserted by their bank creditors.  In recent years, debtors have argued that a bank’s issuance of an Internal Revenue Code form 1099-C “Cancellation of Debt” has the effect of waiving the bank’s claims against the borrower, and should preclude the bank from having an allowed claim in the bankruptcy case.  Fortunately, some recent court opinions state that a bank’s issuance of a 1099-C does not constitute a waiver, and the bank remains entitled to enforce its claim in a subsequent bank

In difficult economic times, debtors’ attorneys closely review credit reports looking for potential legal claims against creditors. Long after a debtor has been discharged from bankruptcy, creditors can find themselves defending claims of improper credit reporting. A recent case from the Eastern District of North Carolina illustrates the trouble facing creditors who furnish incorrect reports of discharged debt. See In re Adams (Bankr. E.D.N.C. 2010).