What New Bankruptcy Lawyers Need To Know: Beyond The Code

Beware the Emergency Bankruptcy Filing

By Cathy Moran, Esq. Filed Under: Before filing, Start Here

Real danger for client and lawyer lurks in the emergency bankruptcy petition: File without all the information about the client's assets and recent transfers and you risk getting family members sued and the client losing assets. Not to mention your loss of face or worse. Avoidable transfers Chapter 5 of the Bankruptcy Code deals with avoidable transfers, property of the estate, and … [Continue reading...]

Do Your Bankruptcy Schedules Tell the Client’s Story?

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

The last check before you file your client's bankruptcy schedules should be a step back to see if the schedules "tell the story". The background and the color don't make it to schedules and SOFA, but you need to read them from the trustee's point of view to see if they make sense and reflect the realities of the client's life. Things to look at before you push the button to file: Have you … [Continue reading...]

Exemption Choices for the Recently Mobile

By Cathy Moran, Esq. Filed Under: Exemptions, Start Here

Old and new consumer bankruptcy lawyers have a treasure in John Bates' masterpiece on the exemption laws of each state and the availability of those laws to non residents in bankruptcy. Why do I care what the exemptions are in any state but California? The Bankruptcy Code! ( what other answer did you expect from me? ) BAPCPA tried to eliminate any advantage a debtor might reap by … [Continue reading...]

Means Test & Creditors Claims: Enough is Enough

By Cathy Moran, Esq. Filed Under: Means test

When the means test projected disposable income number is greater than 100% of the unsecured claims, full repayment is sufficient. The means test calculation only kicks in under §1325(b) if a party objects; no one objects to repayment of everything that is owed. A new bankruptcy attorney brought me a B 22 form for a review: the monthly number he'd calculated was over $2500 a month, a … [Continue reading...]

When To File Bankruptcy

By Cathy Moran, Esq. Filed Under: Before filing, Start Here

When to file bankruptcy turns out to be just as important as whether to file. I saw it playing out in a single day in my office. All three consultations on Friday featured clients intent on filing bankruptcy IMMEDIATELY. Each of them was certain that they had no time before some disaster would befall them if they didn't file bankruptcy. Yet, as we talked, I concluded the … [Continue reading...]

Getting the Most from the Means Test

By Cathy Moran, Esq. Filed Under: Means test, Start Here

When the means test look-back period for a well paid individual includes the end of the year, a bankruptcy lawyer cannot rely on the paystubs to define the tax deductions. That's because contributions to Social Security and other some other taxes are capped at certain income levels. Wages above the cap are not subject to the tax. So the later in the year the pay stub, the greater … [Continue reading...]

Fixing the Omission from the Schedules

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

Twice yesterday new bankruptcy practitioners asked about how to deal with debts or assets not listed in the debtor's original schedules. The answer in either situation is amend the schedules. As soon as you know that the schedules are not accurate on a meaningful issue, make them accurate. Creditor left out For an omitted creditor, you want to add them to the schedules and give notice to them … [Continue reading...]

Head Start on Bankruptcy Research

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

Have you found Judge Randall Newsome's bankruptcy research binder on the Northern District Bankruptcy Court's website? This is an awesome compilation of leading cases on the total range of bankruptcy topics. While it's focused on the 9th Circuit, I suggest that new bankruptcy lawyers use it as a starting point for their personal bankruptcy law resource and add the cases in their circuits that … [Continue reading...]

Bankruptcy Schedules Look Forward and Backward

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

New bankruptcy lawyers are often frustrated by the internal inconsistencies required by the "reformed" Bankruptcy Code. Whether it's rational or not, the means test income figure looks backward while the means test expenses set forth are prospective. Some of those prospective expenses are actual (taxes ) while others are contractual (mortgage payments). Social Security income is … [Continue reading...]

Answer to Every Question Starts in the Code

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

If Jews, Muslims, and Christians are People of the Book, we, as bankruptcy lawyers, are, or ought to be, People of the Code, the Bankruptcy Code. Virtually every question that a new bankruptcy lawyer asks ought to send her first to the code for a start. The Bankruptcy Code adopted in 1978, was well thought out in terms of structure, word usage, and organization. The "reforms" of 2005 were … [Continue reading...]

Exemptions & Property of the Estate

By Cathy Moran, Esq. Filed Under: Exemptions, Start Here

Sometimes, as an inexperienced bankruptcy lawyer, it's hard to get your head around the idea that your client can have an asset of substantial value and not need to exempt it when filing bankruptcy. That's because only property of the estate is potentially available to pay the client's creditors in a bankruptcy, and some assets, by definition, are not property of the estate. The most … [Continue reading...]

Track Down All The Client’s Creditors

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

While a new client may seek out a bankruptcy lawyer when they are served with a lawsuit, they may overlook the plaintiff in that very suit when listing their creditors. Pretty amazing, but if you rely on the client to identify their creditors, their list will often omit creditors who didn't send them a bill this month. Or creditors they want to continue paying. Or people they don't want to … [Continue reading...]

Convert, Don’t Dismiss, That Bankruptcy Case

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

Young lawyers just learning bankruptcy practice seem to have missed the portions of the Bankruptcy Code that allow a debtor to convert a case under one chapter of the Code to a case under a different chapter. All too often, when it looks like the client is in the wrong chapter, they propose to dismiss and refile under the new chapter. Not necessary. The Code provides, in sections 706, … [Continue reading...]

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