To Establish Uncollectibility Provide Supporting Documents

A defendant may assert at a mediation that it lacks sufficient assets to satisfy a judgment and is therefore uncollectible. Such a claim, if valid, may trump the merits of the plaintiff’s case. So to establish a credible claim of uncollectibility, provide documents before or at the mediation which show the defendant’s financial condition, such as bank statements, tax returns, financial statements, lien documents and asset appraisals. Plaintiffs usually view a claim of uncollectibility with skepticism, so the defendant’s failure to provide documents that demonstrate financial distress creates a negative inference as to the defendant’s uncollectibility.


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Bankruptcy Mediation is a treatise published by the American Bankruptcy Institute