When it comes to determining if
you are going to file a bankruptcy a number of questions begin popping
up. People ask about student loans, homes, cars, etc. It is often not until
they are just about to file that some of the more subtle questions
are asked. One of those questions is:
If you are in this situation, please
understand that this happens quite frequently.
When creditors are calling and driving you up a wall, sometimes
a utility payment gets paid to another company instead, just to shut them up. After all, the utility companies don’t make
quite as much noise when you miss a payment. The downside is
that before you know it, you are a couple months behind and making partial
The good news is that you can
include those back payments in your bankruptcy.
When you do this, the utility company cannot shut off your utilities for
20 days after the time you file. After
you file they cannot shut off your service for non-payment of the bill you owed
before you filed, but they could then stop service for non-payment of any service used after the filing. For service going
forward the utility companies are entitled to what’s called, Adequate assurance
of payment for future services. Most of
the time this is a deposit of some sort.
If the deposit amount is astronomical, the bankruptcy court has the
power to reduce the amount if it agrees that it is too high. You will have to request a hearing from the court to see if the amount can be adjusted.
If your service has been cut off
prior to filing the service can be restored after you file. You will likely need to follow the new
customer protocol of the utility company and pay a deposit if necessary, but
the service can be restored.
If the utility company violates the Federal Code
and cuts off service in the 20-day window, then you have several remedies. Primarily you will be able to have the Court
order them to restore service. If they
willfully and knowingly violate the rule, then you may be able to try for a
contempt citation. Lastly, if the utilities being shut off causes you harm or
you are damaged in some way by this, then you may be able to see an award of
damages against the utility company.