CreditSlips

Update -- The Sixth Circuit Rules IRAs Are Exempt

06/18/13

A few weeks ago, I posted about an apparent movement to challenge the bankruptcy-exempt status of IRAs based on boilerplate language commonly found in the account agreements of many of the nation's largest brokerages. The legal argument rested on hyper-technical interpretations of the Bankruptcy Code and the account agreements, but nonetheless several lower courts had ruled that debtors could lose their IRAs to the bankruptcy trustee.

[more]

Will the Supremes Trim Back Bankruptcy Courts' Powers?

06/17/13

In addition to the fair housing case that Alan noted, the Supreme Court also granted cert in a bankruptcy case, Law v. Siegel.

[more]

Supreme Court to hear Housing Discrimination Case

06/17/13

The Supreme Court granted certiorari today in MOUNT HOLLY, NJ, ET AL. V. MT. HOLLY GARDENS CITIZENS, on the question whether Fair Housing Act claims of race discrimination in the sale, rental or financing of housing can be proven based on evidence of disparate impact.  The case does not directly involve credit, but is being watched closely by bank lawyers and fair lending advocates for the impact it will have on Fair Housing Act litigation against mortgage lenders.

[more]

Tire Rentals

06/10/13

Wheel and jackThe late

[more]

Seeking Approval of Alternative Compensation Methods Under Section 328

06/10/13

What is the appropriate use of Section 328? Professionals sometimes use section 328 as an alternative means for seeking approval of employment applications, but actually section 328 applies to getting pre-approval for alternative (non-lodestar) modes of compensation. The standard of review for fees earned via compensation structures approved under section 328 is far more restrictive than the standard of review for estate-paid professionals’ fees generally.

[more]

Duties of Counsel for a Debtor-in-Possession

06/07/13

What are the duties of the lawyer represent the debtor-in-possession? We know the DIP has fiduciary duties to the estate. Does this mean that the DIP’s attorney is actually counsel for the “estate”? This is not a question on a law school exam, but a very real and vexing practical issue that arises in situations when the DIP acts in ways that appear to compromise its fiduciary duties to the estate.

[more]

May 2013 Bankruptcy Filing Numbers Continue Trend

06/05/13

The latest data from Epiq Systems are available, and they confirm my estimate last month of just over 1.0 million bankruptcy filings for the 2013 calendar year. Epiq Systems reports 96,430 bankruptcy filings for the month of May. Spread over the 22 business days in the month, that is a daily filing rate of 4,383.

[more]

Limited Scope Representation: An Issue of Access to the Bankruptcy System

06/05/13

The problem of the high cost of consumer bankruptcy representation is well documented. The recent Consumer Bankruptcy Fee Study revealed a 24% increase in attorney fees post-BAPCPA for chapter 13 cases, with mean fees in some jurisdictions approaching $5,000. For no-asset cases filed under chapter 7, mean attorney fees have increased 48%—as high as $1,500 at the mean in some jurisdictions. 

[more]