Five years ago Congress passed the Bankruptcy Abuse Prevention and Consumer Protection Act – and at that time, I couldn’t understand what “abuse” Congress was trying to prevent. As a matter of fact, I penned an op-ed in the Boston Globe expressing my hope that Congress would not pass the legislation because, among other things, I thought the “abuse” was really coming from lenders, not consumers. After representing many honest debtors who deserve the relief that our laws afford, and have gotten the relief they deserve, I met someone yesterday who sought from me the unthinkable: they wanted me to help them lie. And even though I know that lenders and credit card companies have caused a huge economic mess in our country, this person is precisely why BAPCPA was enacted.
Like many debtors, this person made some profoundly regrettable decisions. I can accurately describe them as stupid. Their income is higher than the state’s median (they fail the means test at first glance), and they have exemption issues (meaning they will lose property if they file chapter 7), and they have other complicated issues (meaning I could expect at least one phone call – perhaps two – from the US Trustee). A chapter 7 would be bumpy. A chapter 13 would be expensive, and because of other factors, a very expensive chapter 11 was not out of the realm of possibility. And let’s say that some of the creditors were getting a bit ancy.
This person had a number of options – none of them particularly appealing. But appeal is for the client to decide – not me. To be perfectly frank, I didn’t make their bed – they did. My job is either to get them out of it or make it as comfortable as the law will enable me to. Period.
I was asked a question. I answered it – as the only way I think I can: honestly. Apparently unhappy with the answer, the prospective client attempted to undo the question. The conversation went something like this:
Prospective Client (PC): I have a red car. I want to keep my red car.
Bankruptcy Attorney (that’s me): Sorry, the Bankruptcy Code says you cannot keep your red car. Your red car can pay some of your debts so you’ll have to either give a trustee your red car, or be prepared to pay the value of your red car.
PC: Well, my car really isn’t red. It’s blue.
Me: But you told me the car was red.
(Long pause.)
PC: You know, I was speaking candidly, and I need an attorney I can speak with candidly.
We weren’t talking about cars. We were talking about something far more valuable – but you get the point. To be clear, the bankruptcy code doesn’t say anything about the color of cars.
What this person wants is an attorney they can lie to. Perjury is a crime (disclosures are made under oath). No attorney may help a client commit a crime…or commit perjury. What’s painfully sad is that this person believes that not only are they entitled to an attorney who they can lie to, but that they believe there are attorneys who will help them further their dishonesty in the bankruptcy process.
What vexes me most is that for almost five years, I – along with scores of my colleagues – have tried to learn, adapt and practice under an almost entirely new statutory scheme that was touted to prevent abuse and protect consumers. I’ve written about it, studied it, attended, presented and argued at conferences (and still do). Most of my learned colleagues will agree that since BAPCPA it’s been frustrating to watch honest and deserving debtors gather documents we wish we did not need, jump through hoops we wish we did not have to hold up, and pay extra for work that once would have been considered superfluous all because Congress has us believing that bankruptcy debtors are dishonest. The overwhelming majority of debtors I have represented have gotten through the process and moved on with their lives. I thought Congress was wrong about bankruptcy debtors and was wrong about BAPCPA.
Yesterday, I learned I was wrong about BAPCPA. This person is not honest. They are not unfortunate. They are pathetic. They are exactly why BAPCPA was enacted: to prevent a dishonest person with means from avoiding their responsibilities to the detriment of their creditors. It is their sense of entitlement that gave birth to BAPCPA. And sadly, this person is not the only dishonest person I’ve encountered but this one compels me to write about it.
If for no other reason, BAPCPA preserves for deserving people the relief that the Bankruptcy Code affords. We need BAPCPA because honest people make regrettable decisions, get sick, lose jobs, get divorced and have other bad things happen to them. We need BAPCPA because honest people who cannot keep their promises need the safety net that Congress established for them. We need BAPCPA because people who lie, cheat, conceal assets and hope to slide their way through the bankruptcy process do not deserve that same relief afforded to honest people.
While this person is neither honest nor deserving – it is important to remember that relief remains available for those who are. Look at it this way, when it works, BAPCPA keeps scoundrels like this out of the system…or makes it particularly unpleasant if they choose to embark in it.
But it is still tough to admit when you’re wrong. And I was wrong about BAPCPA.
Related posts:
- The Two Edge’s of BAPCPA’s Sword
- Honesty and Bankruptcy, Part II: Feeling Dishonest
- Honesty and Bankruptcy, Part III: The Reality Check and the Boy Scout
- Chapter 13 for Chapter 7 Debtors
- A Headache on a Friday Afternoon
Tags: Bankruptcy Abuse Prevention & Consumer Protection Act of 2005, Bankruptcy Fraud, BAPCPA
[...] I Was Wrong about BAPCPA [...]