Mekhi Phifer Files for Bankruptcy

This week, something pretty surprising happened: Mekhi Phifer, 39, who currently stars in the television show Divergent, filed for bankruptcy.

Phifer, who co stared on the hit show ER for six consecutive seasons, has had a fairly successful acting career working steadily in both television and film for over ten years. According to People, Phifer also launched a film promotion company, Third Reel Films, in 2011.

So how did this seemingly successful star and employed actor end up such debt? People reports that the actor has debts totalling $1.3 million, which includes $1.2 million owed in back taxes, $50,000.00 in legal fees, and approximately $4,500.00 in child support arrears.

Phifer is currently married to Reshelet Barnes. However, he has two children with two separate women: namely, actress Malinda Williams and Oni Souratha.

While unfortunate, Phifer's financial troubles raise some interesting legal questions and create a great opportunity to discuss bankruptcy in the context of family law proceedings. With respect to Phifer's ongoing child support obligation, presuming he is still making an income from his television show, his ongoing child support obligation should not be affected. Phifer will still be obligated to pay support based on his current annual income, which is assessed every year. Child and spousal support are not affected by a claim for bankruptcy according to s. 178(1)(c) of the Bankruptcy and Insolvency Act (BIA). With respect to Phifer's arrears, the Bankruptcy and Insolvency Act stipulates that family support claims are a claim provable under the Act. As such, his former partners are creditors who can make a claim against his trustee in bankruptcy.

Now, if Barnes and Phifer were separated and in the process of determining property matters, Phifer's bankruptcy would also have an effect on the equalization issue. From the bankruptcy side, unsecured creditors are to be treated equally and the bankrupt's assets to be distributed amongst them equally subject to s. 136 of the BIA. The Family Law Act does not accord any preferred or secured position to a claim for an equalization payment. While certain claims for support have preferred status, as discussed above, no such provisions exist with respect to family property. Therefore, a discharge operates to release the bankrupt, in this case Phifer, from all claims provable in bankruptcy, including equalization claims. Accordingly, if Phifer were to receive a discharge, his spouse would not be able to enforce an equalization claim against him.

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