Spouses and Co-debtors

Occasionally, I need a good, old-fashioned slap upside the head. Here is the scenario. Client is married, but files a Chapter 13 Bankruptcy without her spouse joining her. The electric bill is delinquent at the time the case is filed. I didn’t realize until later that the electric bill was only in the non-filing spouse’s name. Utility company terminated service post-petition with actual notice of the bankruptcy filing.

So, what’s the problem? It isn’t the debtor’s bill, it is her husband’s. She isn’t liable for it — right?

Wrong.

Husband and wife shall be jointly and severally liable for debts incurred on account of necessaries furnished to either spouse unless otherwise provided by law or court order. 43 O.S. 209.1

This little gem of a statute, coupled with the utility company’s policy not to let the spouse establish new service in her own name until the prior account has been settled; and, of course, the Bankruptcy Code’s extension of the Automatic Stay to co-debtors in a Chapter 13 case, is about to make my office a little more interesting. It is the first case I know of to make these arguments in Oklahoma. I will keep you informed.

Elaine

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Categories: Bankruptcy, Consumer Credit | Leave a comment

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