What is the effect of a debtor's failure to disclose a potential lender-liability lawsuit in a bankruptcy proceeding?

Because of the Bankruptcy Code requirements to disclose the whole spectrum of a petitioner's financial affairs, "courts that have considered the effect of a debtor's failure to disclose a potential lender-liability lawsuit in a bankruptcy proceeding have universally held that the debtor is equitably estopped, judicially estopped or barred by res judicata ² from bringing the action after confirmation of the bankruptcy reorganization plan. [Citations.] [p] Those decisions rely primarily upon the well-established requirement that a debtor seeking the benefits of bankruptcy must fulfill the companion duty of fully disclosing and scheduling all property interests and rights so that the bankruptcy court and creditors can make an informed decision about the [42 Cal.App.4th 1092] debtor's proposed reorganization plan." ³ (Littlefield v.

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