Bankruptcy Law Questions? Ask a Bankruptcy Lawyer Now.
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If you owe someone money, and that person files a Bankruptcy, the Bankruptcy court acquires the right to collect the money that is owed.
The Bankruptcy court will be able to attempt to collect the money in the same manner as the person to whom the money is owed - by attaching valuable assets, and by garnishing bank accounts and wages.
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Once the party (to whom the money is owed) files a Bankruptcy, the trustee will have the right to collect any judgment based on such a lawsuit. This means the trustee would also have to file such a lawsuit - which the trustee is unlikely to do if there is no written proof (agreement) that the money is owed.