About Me
“ Craig D. Robins, Esq., has been a practicing Long Island bankruptcy attorney for over twenty-four years ”
Written by Craig D. Robins, Esq.Of course not. Clothing is protected. When you file for bankruptcyin the State of New York, a consumer can keep and protect a certain amount of clothing.
Although there is a specific dollar amount for personal effects which include clothing, for all practical purposes, all usual and ordinary clothing is exempt and protected. The fact is that a trustee has no interest in trying to liquidate someone’s used duds.
There are only two possible exceptions. One would be an expensive fur coat which actually has to be separately itemized on the schedule of assets in the bankruptcy petition. The other exception might be a collection of expensive designer dresses.
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However, in over twenty years of representing consumer debtors, I have yet to file a bankruptcy case with either.
A debtor will probably be able to keep even once-expensive designer clothes
I did have one client several years ago whose husband, while he was working, earned several hundred thousand dollars a year. The wife had spent over $500,000 on designer clothes in the five-year period before they retained me. In fact, their largest creditor was Barneys, the famous New York clothing store, which was owed about $200,000.
We never had to address how a trustee would handle the designer clothes because the matter was resolved without a bankruptcy filing.
Looking at what happened to former vice-presidential candidate Sarah Palin’s designer clothes, which were very much in the news last fall, the Republican National Committee eventually determined that they only had nominal value and turned them all over to Goodwill, even though they had cost many tens of thousands of dollars. So chances are that even if a consumer who was previously affluent files for bankruptcy owning some designer clothes, the trustee will not care less about them.
The bottom line: used designer clothes, even if they have potential value, are not easy to liquidate. Therefore, even if they may be technically non-exempt, a debtor will probably end up being able to keep them.
