Bankruptcy Mastery - Becoming a better bankruptcy lawyer

Rule 3002.1 And The Tangled Web of HOA Assessments

By Cathy Moran, Esq. Filed Under: Rule 3002.1

The Hadfeg decision was delivered to me in response to a standing search for bankruptcy decisions involving FRBP 3002.1. But multi strands of legal theories run through this one. The questions, answered and unanswered, are tantalizing. The facts are thus: Prepetition HOA dues scheduled for $5000, while HOA later claimed it was $33,000. No proof of claim filed by HOA Post petition, HOA levies special assessments, without filing notices provided in R. 3002.1 Special assessments unpaid at plan's end At the conclusion of the plan, the debtor filed a motion pursuant to R.3002.1 to compel the HOA to deem the HOA payments current. The HOA filed no opposition, then moved to vacate the order entered by default. HOA's wish list The HOA was expansive in its list of wants. It wanted a determination that the difference between the arrears scheduled in the plan and the arrears shown on its books, survived the discharge as an enforceable lien on the condo. It wanted … [Continue reading...]

Filed Under: Rule 3002.1

Crushing Tax Change For Injured Consumers

By William Purdy Filed Under: Bankruptcy Practice, Opinionated, Tax

Under the new tax law, most damage awards a consumer recovers stand to go, in large part, to the IRS. So even if you are successful in vindicating your legal rights, the expenses of getting the award aren't deductible from the gross award. The taxing authorities end up getting a large hunk of the total recovery. Welcome to tax "reform". Consumers get shafted It isn't … [Continue reading...]

Rescuing A Troubled Chapter 13: The Unseen Threat

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

We all get sucked in, at some time, to trying to rescue a Chapter 13 bankruptcy case gone bad. Make sure that you don't let a bad situation get worse. Get your arms around §109(g). When only a do-over will do, don't wait around. No payments for months The debtor came to me for help when the trustee moved for dismissal of a long confirmed plan for feasibility issues. The goal of the … [Continue reading...]

Start with problem, not procedure

By Cathy Moran, Esq. Filed Under: lawyer skills

The new bankruptcy lawyer sent me an email. What do I file when there's an objection to my client's amended Chapter 13 plan: notice a hearing? file a demurer? In her case, the form of the "objection" suggested the opposing counsel was as new to bankruptcy as the debtor's lawyer. My advice? First: figure out whether there's a lawyer-to-lawyer solution before figuring out how to involve a … [Continue reading...]

What Debts to Include in Bankruptcy

By Cathy Moran, Esq. Filed Under: Before filing

Bankruptcy lawyers know that all debts need to be scheduled. Clients think or hope that they get to pick and choose. Every effective bankruptcy lawyer needs a line, a phrase, or a story to squelch the client's instinct to exclude things from their bankruptcy filing. Often the client's desire to be less than forthcoming is born of fear or ignorance. Your job is to figure out which … [Continue reading...]

Why Your Bankruptcy Client Doesn’t Understand You (And How To Fix the Problem)

By Cathy Moran, Esq. Filed Under: Before filing

Bankruptcy attorneys and their clients often seem to be a pair, divided by their common language. Even without legal jargon, we talk past each other. How do we misunderstand each other? Let me count the ways: Property: I don't have any property, lost the house to foreclosure last year. Property 2: I don't own the house, the bank does Here are my debts: I'm current on … [Continue reading...]

Filing Bankruptcy Petitions: Playing Connect the Dots

By Cathy Moran, Esq. Filed Under: Before filing

I almost took the client at her word and filed schedules that told half the story. Well, maybe it was 3/4 of the story, but the client who, to my consternation, seemed to enjoy nit picking the draft schedules, told me about the cabin on the lake that they rent out, but omitted the rental income, the management fee, the utilities and any provision for maintenance on the property from the … [Continue reading...]

Ensure You Understand Insurance In Bankruptcy

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

Sometimes, issues that you've just skimmed over burst forth in bunches, demanding attention. Lately, that issue in my bankruptcy cases has been insurance. Because its treatment varies so, we need to be asking more pointed questions of clients about both insurance policies and the debtor as beneficiary. Unmatured life insurance Starting with exemptions, §522(d)(7) makes an … [Continue reading...]

Find Solution That Works, Bankruptcy or No

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

Procrutes assaulting his guest upon the bed

Good income, substantial priority tax debt, other debt within the limits: sounds like a Chapter 13 bankruptcy, doesn't it? Yet the clients were in my office for a second opinion, convinced they couldn't sustain over five years the payments their attorney provided in their Chapter 13 plan. Their attorney's approach reminded me of the Greek story of the brigand Procrustes, who waylaid … [Continue reading...]

Prompt Full Disclosure from Bankruptcy Clients

By Cathy Moran, Esq. Filed Under: Before filing

If the price of a bankruptcy discharge is full disclosure, some clients still want to underpay. No matter how carefully you script your initial interview with a client in quest of everything you need to know to advise them on bankruptcy, there will be some tidbit, relevant to your quest, that isn't evoked with your questions. But, never fear, you have another trick up your sleeve: the open … [Continue reading...]

The Hazards Of Self Employment In Chapter 7

By Cathy Moran, Esq. Filed Under: Business bankruptcy

Why would a Chapter 7 trustee shut down a proprietorship business with no value? That question comes up again and again from newish bankruptcy lawyers who can't imagine that a trustee would demand the closing of the debtor's business. After all, goes the argument, the debtor needs to make a living and the business has no non-exempt value. The trustee's insistance on closing the business … [Continue reading...]

Why The No-Look Fee In Bankruptcy Harms Us All

By Cathy Moran, Esq. Filed Under: Attorneys fees

The no-look fee is no good in many bankruptcy cases. It harms debtors, their lawyers, and the system as a whole. It fails to compensate the lawyer for critical work, causing a disincentive to providing proper representation. We give up a lot when we settle for being paid just the no-look fee. No-look (or presumptive) fees were instituted to relieve courts of reviewing fee applications in … [Continue reading...]

How To Brush Off The Means Test

By Cathy Moran, Esq. Filed Under: Means test

There's a way around the means test. And it's right there in the Code. Yet we forget. The ***x!!XXX thing only applies to debtors whose debts are primarily consumer. Consumer debt is defined: 8) The term “consumer debt” means debt incurred by an individual primarily for a personal, family, or household purpose. I had to review what isn't consumer debt the other day to extract a client from … [Continue reading...]