First, you need to read your divorce decree. Does it contain the “magic” language, indicating that your spouse will indemnify you and hold you harmless? Regardless, one of the biggest misconceptions people have, is that divorce decrees are binding on third parties. The fact is, it is only an allocation of that debt between the two of you, and is meaningless to the creditor. While a chapter 7 bankruptcy will discharge your former spouse’s obligation to pay the creditor, debts that are owed to a former spouse are not discharged in a chapter 7 (although they are in a chapter 13). Therefore, if you are then required to pay that debt because the creditor cannot go after your spouse, then you have been harmed, and if your spouse agreed to hold you harmless and indemnify you, then you would have the right to go back to family court and get a judgment against your former spouse, after you pay off or settle with the creditor, pursuant to Fast v. Fast 766 N.W.2d 47 (Minn.App. 2009) and may be entitled to attorneys fees as well if your decree so provides. If you did a “do-it-yourself” divorce without lawyers involved, chances are you don’t have the “magic” hold harmless indemnification language.

If your former spouse files chapter 13, you are probably without a remedy, unless you can prove that their obligation to indemnify you was somehow in the nature of a support obligation. But the nice thing about a chapter 13 is that there usually is a “co-debtor stay” where the creditor cannot come after you while your ex is in the chapter 13 for 3-5 years, and sometimes the creditor will let it slide thereafter, although sometimes they will sue you once he chapter 13 is done, or even get the stay lifted to come after you before it’s done.

My experience is that if your former spouse files bankruptcy on joint debts, you will usually be best off doing the same yourself. We can ask that your former spouse pay for your bankruptcy attorney’s fees, which may be a fair resolution. The alternative to filing your own bankruptcy is to pay off the entire debt, and then pursue a judgment against your former spouse, who has already declared chapter 7 bankruptcy and therefore probably does not make much and would be difficult to garnish (especially if they are already paying child support or spousal maintenance). And even if you got to that point, then they could file a chapter 13 and zip you anyway.