Think Beyond The Means Test

It started as a means test question:  could emergency medical expenses be deemed non consumer debt.  It ended up as a step back to get the bigger picture.

Well seasoned bankruptcy counsel brought the fact pattern to a list serve of colleagues.  The prospective debtors’  income in a small consulting corporation is declining,  his health crisis raises not only income issues but issues of  end of life expenses; and there’s apparent money on the bottom line.   What to do?

Before this group of two dozen experienced lawyers had finished, we were talking about

  • Sufficiency of projected medical expenses for the couple
  • Timing of the case:  now or later
  • Should both spouses join in a Chapter 7
  • Was Chapter 13 a better choice
  • What new debts might arise as business wound down or health failed
  • Was survivor in danger of giving up life insurance benefits or inheritance should husband pass away within 6 months of filing

It brought to mind Judge Jaroslovsky’s advice on active listening: when you see medical expenses in the client’s pile of bills, the immediate question must be, How are you feeling now?  Is the medical issue behind you?  All these questions address the decision as to when the bankruptcy case is filed.

I’ve  battled  the view of bankruptcy practice as a matter of filling out forms as an issue for rookies in the field.  Just because you have a software program doesn’t mean you are equipped to be a capable bankruptcy lawyer.

But this exchange among those who know that truth well showed that even the grey-beards can benefit by stepping back and looking at the big picture.  Seldom is our client’s life as simple as it seems on the surface.

Image courtesy of skinnylawyer.