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THE CONSUMER BANKRUPTCY LETTER |
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In This Issue:
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November 7, 2004
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ACADEMY NEXT STOP - TEXAS!
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AFFORDABLE ONLINE CASE RESEARCH
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PENDING EVENTS, SEMINARS & CLE
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HEADS-UP ON RECENT CASES
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NEW JERSEY CURTAILS BANKRUPTCY ADVERTISING
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ADVERTISING THAT PROMISES TOO MUCH IS CRITICIZED
For the second time this year, a New Jersey Supreme Court committee is reining in lawyers who market their services through mass mailings to people whose names appear on court dockets.
In an opinion published Monday, the Committee on Attorney Advertising sharpened the pencil on what bankruptcy lawyers can say in solicitation letters and what disclosures they must make.
Examples of "overreaching and improper statements," include:
"If you do not act quickly, you could very likely lose your property or home."
"YOU NEED NOT LOSE YOUR SINGLE MOST IMPORTANT INVESTMENT, BUT YOU MUST ACT SOON."
"In order to save your home you must act quickly and you must do so having been given the right advice... Time is limited."
The committee faulted lawyers for touting themselves with language like:
"YOUR BANKRUPTCY SPECIALIST."
"I have been helping people just like you save their homes and improve their financial condition for the past XX years."
"My practice is exclusively devoted to debtor relief and I have developed an expertise in assisting homeowners in saving their property."
"I urge you to compare my experience, reasonable fees, and personal attention."
The letters also exaggerate the benefits of bankruptcy by making unqualified statements that it can stop foreclosure, car repossession, utility shutoffs and creditor harassment and wipe out credit card debt, said the committee.
N.J. Panel Curbs Solicitations for Bankruptcy Work
Lawyers' letters called 'formulaic,' hyperbolic in predicting disaster
Mary P. Gallagher
New Jersey Law Journal
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BANKRUPTCY FILINGS SOAR TO NEW RECORD
Last year, appeals filed in the U.S. courts of appeals increased 6 percent, to 60,847. In the district courts, civil filings dropped 8 percent, largely because of a reduction in asbestos-related cases, but criminal filings rose 5 percent and immigration cases increased 22 percent. Bankruptcy filings increased 7 percent to a record 1.6 million.
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CONSUMERS VICTIMS OF WISHFUL THINKING
The "Reality Gap," which is the difference between the amount of debt consumers say they will pay off in the next month versus the amount of debt they actually paid off a month later, narrowed by 2 percentage point from October to 9 points. A month ago, 78% of Americans planned to pay off debt, while a month later only 69% actually did so.
SOURCE: Credit & Collections World News (CollectionsWorld.com)
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HELD, NO DEADLING FOR FILING POSTPETITION CLAIM
This Chapter 13 case is before the court on the debtor's motion to compel the trustee to pay a postpetition tax claim. The trustee has refused to pay the claim, principally on the ground that it was not timely filed. However, as discussed below, there is no deadline for filing postpetition claims in Chapter 13, and because other objections posed by trustee also fail, the debtor's motion will be granted.
IN RE WOODS, (N.D.Ill. 2004)
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Plaintiff, James Darryl Foust ("Debtor"), has filed a complaint under 11 U.S.C. § 523(a)(8) seeking a judicial determination that the particular debts owed by him to the above-named defendants on the date of the filing of his chapter 7 petition in the amount of approximately $230,000 arising out of student loan obligations are dischargeable. The ultimate and sole issue here is whether the debtor's student loan debts owed to these defendants are dischargeable, in whole or in part, because of the asserted undue hardship it would create for him not to discharge the debts. Based on the entire case record ...
IN RE FOUST, (W.D.Tenn. 2004)
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HELD, PREVAILING PARTY MAY BE ENTITLED TO ATTORNEY'S FEES
Whether fees may be awarded in bankruptcy proceedings generally depends, in part, on whether the case involves state or federal claims and whether the applicable law allows such fees. A prevailing party in a bankruptcy proceeding may be entitled to an award of attorney fees in accordance with applicable state law if state law governs the substantive issues raised in the proceedings. In cases under § 523(a)(2), however, "the determinative question . . . is whether the successful plaintiff could recover attorney's fees in a non-bankruptcy court. In a nondischargeability action based upon misappropriation of goods delivered under a bailment, the essential nature of the action was in tort and not in contract, and the award of fees was not warranted.
In re Bertola (9th Cir. BAP 2004)
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HELD, NOTICE OF MOTION MUST BE TO SPECIFIC NAMED OFFICER
Where a debtor served a contested matter on a corporate creditor by mailing the moving papers to the creditors P.O. Box: "To Officer, General Manager, and Agent for Service of Process," the services was ineffective and deprived the creditor of due process. Nationwide service of process by first class mail is a rare privilege which should not be abused or taken lightly and, thus, the service has to be made to a specifically named officer. Concurrent service on the creditor's State court attorney was also ineffective in the absence of proof that the attorney was either explicitly or implicitly appointed by the creditor to receive service of process on its behalf.
In re Villar (9th Cir. BAP 2004)
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PUBLISHED BY KING BANKRUPTCY MEDIA FOR BANKRUPTCY PROFESSIONALS 7080 Donlon Way Suite 222 Dublin California 94568 (925) 829-6460
© King Bankruptcy Media 2004 CONTACT US AT editor@bankruptcymedia.com
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