Bankruptcy Mastery

Becoming a better bankruptcy lawyer

  • Home
  • About Cathy
  • Contact Cathy
  • Articles by Topic
    • Attorneys fees
    • Bankruptcy Practice
    • Before filing
    • Business bankruptcy
    • Cases new & significant
    • Counseling clients
    • Family Law in Bankruptcy
    • Means test
    • Opinionated
    • Real property
    • Rule 3002.1
    • Tax
  • Table of Contents
  • Start Here

Bankruptcy Cases Not Predictably Simple

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice, Start Here

freeway road ahead

I’ve been aghast at the willingness of lawyers brand new to bankruptcy practice to take on cases and issues far beyond their current competence.  I’ve tried to gently counsel that  both self preservation and the client’s best interest require the inexperienced to pass on cases beyond their present skill set.

I realized just how glib  and unrealistic that advice could be yesterday when a young lawyer asked about the impact on a Chapter 13 case should the debtor receive life insurance proceeds during the case.  Everything else about the case in question was vanilla simple;  the question of a windfall during a 13 is not, where I practice anyway, an obvious or settled question.  And the death of a loved one not necessarily predictable.

People are what makes this practice perpetually intriguing, and people’s lives take turns and twists.  We try to look as far down the road as possible, but issues lurk in the turn outs and the cross streets. We can’t foresee every complication that may arise in even simple cases.  We just have to be prepared to respond.

My thought on the possible life insurance payment was to consider whether the owner of the policy would consider changing the beneficiary designation to leave any proceeds to the debtor in a spend thrift trust.  Then we don’t need to speculate on what the answer to property of the estate and vesting questions is.

Photo courtesy of notelse.

More from my site

  • Clients to avoid: those with bankruptcy-adverse spousesClients to avoid: those with bankruptcy-adverse spouses
  • Ask “Why Me?” When It’s Chapter 11Ask “Why Me?” When It’s Chapter 11
  • Counting to 90Counting to 90
  • Newbie Summer Reading:  Johnson v. Home State BankNewbie Summer Reading: Johnson v. Home State Bank
  • Who Needs To Learn More Bankruptcy Law?Who Needs To Learn More Bankruptcy Law?
  • What, Me Worry?What, Me Worry?

Filed Under: Bankruptcy Practice, Start Here Tagged With: client intake, client selection, insurance proceeds, learning bankruptcy law, post petition acquisition

Comments

  1. Michael Marr says

    January 23, 2010 at 12:08 pm

    A friend has a Chapter 13 where Debtor 1 died and left Debtor 2 $20k in life insurance proceeds. Attorney was trying to adjust medical expenses on J to eat up some of the money. I inquired of Debtor 2’s age (over 60) and whether she had any other pension or retirement. She did not so I suggested he try to keep the whole 20k from the hands of creditors since it would/could/should be her retirement. Don’t know the outcome of that yet.

    • Cathy Moran says

      January 23, 2010 at 4:53 pm

      Good thinking. California has an exemption in state law for insurance proceeds necessary for support as do the federal bankruptcy exemptions.

  2. Russ DeMott says

    January 23, 2010 at 3:41 pm

    Great post, Cathy! This is why the “one size fits all” fee scheme doesn’t work as well. Bankruptcy lawyers AND clients should be aware that each case is unique and has unique requirements. A cookie cutter approach is a formula for disaster.

    By the way, great site! It’s very attractive and user-friendly.

[footer_backtotop]

Copyright © 2025 ·Prose · Genesis Framework by StudioPress · WordPress

Theme customization by Rowboat Media LLC