Recent Illinois Bankruptcy Case Highlights Importance of Having Experienced Counsel
When you file for consumer bankruptcy, it is essential to have an experienced bankruptcy lawyer you can trust to assist with each stage of the process. The U.S. Bankruptcy Code is extremely complicated, and both Chapter 7 bankruptcy and Chapter 13 bankruptcy have a variety of complexities that can be difficult to navigate without the help of an attorney. A recent Illinois bankruptcy case emphasizes just how important it is to have an experienced and dedicated lawyer on your side throughout your bankruptcy case. In the case In re: Charles V. Cook, Sr., the U.S. Bankruptcy Court for the Northern District of Illinois found that the bankruptcy firm was liable for failing to disclose information in a consumer bankruptcy case.
At the Emerson Law Firm, we have years of experience providing experienced practiced representation to our clients in a wide variety of consumer protection matters. We want to discuss this recent case and to say more about how it underscores the need for an experienced lawyer in every personal bankruptcy case.
Getting the Facts of the Case: In re: Charles V. Cook, Sr. (2019)
In this case, the debtor, Cook, contacted a law firm to learn more about filing for Chapter 7 bankruptcy. He met with a paralegal at the law firm who gave him information about the cost of the bankruptcy case and additional information about filing. At that meeting, he signed a retention agreement and made a payment. Cook continued to make payments to the law firm for 14 months, at which time he was informed that his bill had been paid in full. Cook’s Chapter 7 bankruptcy case began on October 7, 2014, at which time his lawyer filed his bankruptcy petition. The required 341 meeting of creditors was scheduled for the following month on November 21, 2014.
Prior to the 341 meeting of creditors, Cook’s lawyer learned that he had at least one pending claim under the Fair Debt Collection Practices Act (FDCPA). However, Cook’s lawyer did not amend the debtor’s schedules prior to the 341 meeting of creditors. The pending FDCPA claim was never added to the case, and Cook eventually received a Chapter 7 bankruptcy discharge on January 21, 2015. In addition to this pending FDCPA claim, Cook’s lawyer also failed to initially disclose another FDCPA claim that had been settled a month before the bankruptcy petition was filed. While the lawyer later amended the schedule to list this latter FDCPA settlement, the $1,000 settlement amount was listed as exempt. Both FDCPA claims existed prior to the filing of the bankruptcy petition.
The United States Trustee later noticed that the pending FDCPA claim was missing from the bankruptcy case and moved to reopen Cook’s Chapter 7 bankruptcy case “to pursue sanctions for the misleading filings.” In other words, the United States Trustee pursued sanctions against the law firm for failing to disclose the pending FDCPA case. The Trustee’s case also included the law firm’s failure to disclose the second FDCPA claim at the outset that had been settled prior to the filing of Cook’s bankruptcy petition.
Bankruptcy Lawyers Have a Duty to Ensure that All Claims are Included in Bankruptcy Case
The failure to disclose the FDCPA claims is an example of a mistake that an individual might make without having an experienced lawyer on his or her side—it should not be a mistake made when a debtor has counsel. The U.S. Bankruptcy Court for the Northern District of Illinois underscored that the law firm in this case had a due “to ensure all debtors’ FDCPA claims were included” in the bankruptcy case, and that the firm’s efforts to fulfill this duty were “not adequate.”
The Court ultimately determined that the law firm had violated the U.S. Bankruptcy Code, and although it did not issue sanctions, it did issue a civil penalty of $10,000 and required the firm to pay fees to the Trustee.
Contact an Experienced Oak Park Bankruptcy Lawyer
It is important to hire a bankruptcy lawyer with years of experience serving debtors in bankruptcy cases. If you have questions about filing for consumer bankruptcy, an Oak Park bankruptcy lawyer at our firm can discuss your case with you today. Contact the Emerson Law Firm for more information.
See Related Blog Posts:
Can I File for Bankruptcy if I am Self-Employed?
Are Consumers in Generation Z Changing Debt Management Trends?
At the Emerson Law Firm, we have years of experience providing experienced practiced representation to our clients in a wide variety of consumer protection matters. We want to discuss this recent case and to say more about how it underscores the need for an experienced lawyer in every personal bankruptcy case.
Getting the Facts of the Case: In re: Charles V. Cook, Sr. (2019)
In this case, the debtor, Cook, contacted a law firm to learn more about filing for Chapter 7 bankruptcy. He met with a paralegal at the law firm who gave him information about the cost of the bankruptcy case and additional information about filing. At that meeting, he signed a retention agreement and made a payment. Cook continued to make payments to the law firm for 14 months, at which time he was informed that his bill had been paid in full. Cook’s Chapter 7 bankruptcy case began on October 7, 2014, at which time his lawyer filed his bankruptcy petition. The required 341 meeting of creditors was scheduled for the following month on November 21, 2014.
Prior to the 341 meeting of creditors, Cook’s lawyer learned that he had at least one pending claim under the Fair Debt Collection Practices Act (FDCPA). However, Cook’s lawyer did not amend the debtor’s schedules prior to the 341 meeting of creditors. The pending FDCPA claim was never added to the case, and Cook eventually received a Chapter 7 bankruptcy discharge on January 21, 2015. In addition to this pending FDCPA claim, Cook’s lawyer also failed to initially disclose another FDCPA claim that had been settled a month before the bankruptcy petition was filed. While the lawyer later amended the schedule to list this latter FDCPA settlement, the $1,000 settlement amount was listed as exempt. Both FDCPA claims existed prior to the filing of the bankruptcy petition.
The United States Trustee later noticed that the pending FDCPA claim was missing from the bankruptcy case and moved to reopen Cook’s Chapter 7 bankruptcy case “to pursue sanctions for the misleading filings.” In other words, the United States Trustee pursued sanctions against the law firm for failing to disclose the pending FDCPA case. The Trustee’s case also included the law firm’s failure to disclose the second FDCPA claim at the outset that had been settled prior to the filing of Cook’s bankruptcy petition.
Bankruptcy Lawyers Have a Duty to Ensure that All Claims are Included in Bankruptcy Case
The failure to disclose the FDCPA claims is an example of a mistake that an individual might make without having an experienced lawyer on his or her side—it should not be a mistake made when a debtor has counsel. The U.S. Bankruptcy Court for the Northern District of Illinois underscored that the law firm in this case had a due “to ensure all debtors’ FDCPA claims were included” in the bankruptcy case, and that the firm’s efforts to fulfill this duty were “not adequate.”
The Court ultimately determined that the law firm had violated the U.S. Bankruptcy Code, and although it did not issue sanctions, it did issue a civil penalty of $10,000 and required the firm to pay fees to the Trustee.
Contact an Experienced Oak Park Bankruptcy Lawyer
It is important to hire a bankruptcy lawyer with years of experience serving debtors in bankruptcy cases. If you have questions about filing for consumer bankruptcy, an Oak Park bankruptcy lawyer at our firm can discuss your case with you today. Contact the Emerson Law Firm for more information.
See Related Blog Posts:
Can I File for Bankruptcy if I am Self-Employed?
Are Consumers in Generation Z Changing Debt Management Trends?
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