"We don't need no stinkin' bankruptcy laws."

[captainsblog]

Instead of spending the day earlier in the week reading aloud their sanitized-for-your-protection version of the Constitution with all the icky bits like slavery edited out, our new Congressional leadership might spend some time educating their ruling-class friends on other, more recent laws, that have much more effect in our everyday lives.

The Bankruptcy Code, for one.  It's the single most important statute to my practice, and I've lived and breathed it since it was a still-toddler of a New Law when I started practicing in 1984.  Perhaps its most important provision is the "automatic stay." Just by filing a case, for most purposes, your creditors have to take a chill pill, stop whatever they're doing, and not start anything new. There are exceptions, and that list has grown faster than kudzu over the 30-year time since its original passage, but none of the exceptions allow a garden-variety creditor to begin or continue a garden-variety lawsuit, or send a garden-variety demand for payment, or debit an account on an unsecured debt, once the case has been filed.

As Bill Cosby once said to God, Right!

I ended 2010 with two contempt motions against creditors who didn't Get It. So what came at the end of the first week of 2011?

(1) Call from client, who'd filed his case in mid-2010 and got his discharge of all his debts. He specifically named a possible claimant for personal injury. Two days ago, they served him with a lawsuit on it. Bankruptcy, schmankruptcy, it would seem.

(2) Then, yesterday morning, I got a call from someone I went to law school with. She's now an administrative hearing officer in the state labor department, and was about to conduct an administrative hearing against another of my clients who has been in BK since August. She wondered if we would be going forward. Um, no, this sort of thing is stayed. She asked for the citation. Again, the Labor Department was scheduled as a creditor in this thing- AND FILED A CLAIM- and still insisted on breaking the law.  An hour later, I ran into the law clerk for the Bankruptcy Judge assigned to the case. She'd called him, too, unsure of whether the law allowed her to take her afternoon off.

Teh stupid, it spreads.

Comments

[bktheirregular]

Of course creditors are going to ignore the laws if they think they can get money out of it. It seems to be part of the human condition. (I was going to say it's the "American way", except I see crap like that popping up in Greece as well. Not specifically related to bankruptcy, just general chiseling.)

How badly is the whole mortgage-foreclosure forgot-to-fill-in-the-blanks fiasco affecting your practice, by the way?

[captainsblog.livejournal.com]

How badly is the whole mortgage-foreclosure forgot-to-fill-in-the-blanks fiasco affecting your practice, by the way?

That's a whole different brand of stupid.

Banks are being just as aggressive in getting bankruptcy court permission to foreclose, rather than using the "breathing spell" to work out some kind of win-win modification. Once they get permission, though, many of them don't bother to follow through. The state courts are now requiring that the foreclosing certify that a Real Human Being at the client has personally reviewed the mortgage documents, which may be slowing some of them down. A few bankruptcy judges have denied permission to foreclose where the paper trail looked particularly wonky, but that's not common in these parts.

There are still way too many scams going on before people get to a bankruptcy lawyer, and most of them make things worse, often too worse for us to fix.

[firynze.livejournal.com]

My head hurts just reading this. You poor thing. :(

[liddle-oldman.livejournal.com]

Just remember the Golden Rule -- them what has the gold, makes the rules.

The actual, written law is absolutely irrelevant against what the rich and powerful decide to do to you.