Florida residents may be interested to hear that a settlement was approved in the $40 million bankruptcy case of John L. Smith, former football coach at the University of Arkansas. This ended the Chapter 7 bankruptcy filing for Smith, who was ordered in the settlement terms to pay $265,000 in cash and hand over roughly $400,000 in real estate. The former interim coach of the Razorbacks filed for protection while still a coach at Arkansas. He was since let go from the team after a disappointing 4-8 season.
In his filing, the coach claimed he was $40.7 million in debt after some unfortunate real estate deals. The filing also claimed $1.3 million in assets. Many of his creditors were said to be former business partners or friends, and the case looked like it would be going to trial until settlement talks began. Some of his creditors had alleged that he structured his Arkansas coaching contract improperly to shield money from them. A week before he filed, Smith inked a contract with the Razorbacks that deferred 71 percent of his salary until after the bankruptcy.
This structuring of his pay takes advantage of bankruptcy laws that allow assets held by the debtor to be controlled by the estate, but only for those acquired before the filing. Smith’s deferred pay technically left him just $107.66 a month to live on, after expenses. The rest of his pay would be received after the filing date.
Getting a fresh financial start in Florida may be achieved by filing a timely Chapter 7 bankruptcy. An attorney experienced in debt relief may be helpful when it comes time to deal with overwhelming debt. Such assistance may include efforts to stop creditor harassment, set up asset liquidation and provide other legal services.
Source: USA Today, “Ex-Arkansas coach discharged of debt in bankruptcy deal“, Brent Schrotenboer, September 05, 2013