Can Criminal Fines Be Discharged in a Bucks County Bankruptcy?

I receive many referrals from attorneys, especially Bucks County criminal defense lawyers.  Frequently they want to know whether their clients fees, costs, and restitution can be included in a bankruptcy to get them a fresh start.

Sadly, the answer it generally "no" for a Chapter 7.  If you owe court costs and fines pursuant to a criminal case, those charges are generally not dischargeable.

If you owe restitution as part of a criminal case, it is generally not dischargeable.  Restitution can be for property damage.  If there is a DUI with an accident out of Bucks County, for example, you may be liable for the property damage of the vehicle and any surrounding damage (such as a light pole).  

Restitution can also be for medical bills.  This can include co-pays or deductibles from hospitals.
If there is a "theft of services" charge and a person owes restitution to the victims, that is not able to be discharged.

If a person files a Chapter 13, however, there can't be a discharge but it is potentially possible to pay the fines, costs, or restitution in the plan.

Can I file for bankruptcy while in a Bucks County geriatric community?

Frequently, people in the legal community will send me bankruptcy clients who are either injured or who are senior citizens.

For example, my Quakertown DUI Lawyer friend has been a big source of referrals for my Upper Bucks County office.  When people are disabled, my Bucks County Disability Lawyer friend will send me those who are no longer able to work.  Frequently, they send me people who are senior citizens.

I have represented Bucks County residents who are in a nursing home, over 55 community, or have full-time home health care.  Other times, they have partial home health care.

No one in any geriatric community is precluded from filing a Bucks County bankruptcy.  You just have to qualify for a Chapter 7 or a Chapter 13 like everyone else.

Taping of the Meeting of the Creditors

The Trustee must hold the hearing with the Bucks County debtor or debtors under oath.  Bankruptcy Rule 2003(e) further requires that the hearing be recorded verbatim using electronic sound recording equipment.

The Trustees in Bucks County use a tape recorder and microphone.  These recordings must be made available for access for two years after the hearing date.

So, when you meet with the Trustee, make sure you speak loudly and clearly so the microphone can pick up your answers.

Amendments to a Bankruptcy Petition

You have filed your bankruptcy petition through a Bucks County bankruptcy lawyer.  Prior to filing the petition, you looked at every page and made sure that things are accurate and there were no errors or omissions.

Then....shucks!  You forgot something.  It might be an additional, recurring expense.  Maybe it was a rifle.  Maybe it was a family heirloom.

Well, under Bankruptcy Rule 1009(a) allows for a voluntary petition to be amended by the debtor at any time before the case is closed.  This happens frequently after the Trustee's Hearing where an error or omission shows up.  Sometimes, Schedule C must be amended to add for additional exemptions.  Generally, as long as there is no fraud or false pretense, you should be fine having your attorney file the amendments.

Co-Debtors in a Chapter 7

A lot of people in Bucks County have debts they are seeking in a Chapter 7 but they are co-signed by another individual.

It is important to note and to be understood that the automatic stay applies only to acts against the debtor and the debtor's property.  It does not protect cosigners, guarantors, or other codebtors.

Therefore -- The automatic stay of a Chapter 7 bankruptcy does not prevent a creditor from collecting a dischargeable debt from a cosigner.  This is important -- the calls, lawsuits, and letters may continue against a non-filing debtor.

Real Housewives of Bankruptcy Fraud

The long-awaited trial of the Giudice family has ended with a plea.  Rarely does bankruptcy fraud hit the news.  Go here for an in-depth review of the case.  But, when bankruptcy fraud does hit the news, I'm fixated on the progress of the case (which is frequently unknown given the slow wheel of federal cases).  But, this ended in a not-so-unsurprising way.

Any Bucks County bankruptcy lawyer who has done this long enough has had a client try to commit fraud, either from not disclosing property or income to more nefarious reasons.  Anytime I catch a sniff of fraud, I'm out.  The client gets their money back and the petition is never filed.  It's not worth it.  And, as you can see, it is not worth it for the person committing the fraud.

Sentencing is in July and, after discussions with a Lehigh County criminal lawyer, we both agree that there is a very strong possibility of 12 months incarceration for her and 24+ months for him.

Right of the Debtor -- Utility Services

As a debtor in a Bucks County bankruptcy, you have an opportunity to enjoy the continued use of your utility services (i.e. electric, water, etc.).  Most people in the area get their electric from PECO.

I've blogged about adequate assurance before.  Remember --- even if you owed money to the utility company, they still must provide you with service.  To retain this right, however, a debtor must, within 20 days after the date of the filing of the bankruptcy case, furnish adequate assurance of payment for future services in the form of a deposit or other security.  This is governed under 11 U.S.C. 366.

Getting Your Tax Transcript Just Got Easier

My friend over at Chester County bankruptcy lawyer, wrote a post about tax transcripts that, in a tremendously geeky way, makes me happy.  As stated on the blog E Pluribus Unum,

Earlier today, at the White House Education Datapalooza, an official from the United States Department of the Treasury informed a packed theater and livestream that students, parents and citizens would finally be able to do something simple and profoundly useful over the Internet:download a transcript of their tax return from the Internal Revenue Service

“I am very excited to announce that the IRS has just launched, this week, a transcript application which will give taxpayers the ability to view, print, and download tax transcripts,” said Katherine Sydor, a policy advisor in the Office of Consumer Policy of the Treasury, “making it easier for student borrowers to access tax records he or she might need to submit loan applications or grant applications.”

This is actually a really nice feature.  Albeit, while we have Amazon talking about drone delivery in 2014 and the IRS is now just letting us download our own tax transcript, it is a good step. Since you must provide your last two years of tax returns to your Bucks County bankruptcy lawyer prior to filing, this could speed up the process and reduce frustration.  

 

Duties of the debtor -- Attendance at the Meeting of Creditors

For all individuals who file for bankruptcy in Bucks County, one of the duties they must perform is attending the Meeting of the Creditors.  They must also submit to a formal examination by the Trustee, which involves answering questions under oath.

Your Bucks County bankruptcy lawyer should inform you that you are also required to bring a picture I.D. issued by a governmental unit and proof of your Social Security number, normally in the form of your Social Security card or a W-2 (no copies, original documents only).

A debtor is also required to bring with them evidence of their present income (i.e. a recent pay stub) and a recent statement of your checking/savings accounts.

Certain cases will require additional information.  It is best to talk to your lawyer about the requirements and your lawyer should anticipate any unique circumstances in your case that would warrant additional documentation.  For example, if you are recently divorced, you should contact your Bucks County Divorce Lawyer to get a copy of your Marital Separation Agreement/Property Settlement Agreement just in case the trustee wants to see any asset division.

The Bankruptcy Noticing Center

The central Bankruptcy Noticing Center (BNC) is in Virginia and is part of the Administrative Office of the U.S. Courts.  The BNC sends standard notices in Bucks County bankruptcy cases, including the notice of the commencement of the case.

As bankruptcy attorney, I also receive the Electronic Bankruptcy Noticing Service (EBN).  When you receive your notices regarding your case, you will notice "BNC" frequently.  Now you know why!

Protection against discrimination in a Bucks County bankruptcy

Before we get into a discussion on discrimination and bankruptcy, please note -- if you are in Chester County and are looking for a Chester County bankruptcy lawyer, please contact Gary Freedman at your earliest convenience.  He just launched his website and it looks promising.

Now, 11 U.S.C. 525 protects Bucks County debtors from three types of discrimination:
1)  discrimination by governmental units with respect to employment and with respect to the granting of licenses, permits, franchises, and similar grants
2)  discrimination by private employers with respect to employment; and
3)  discrimination with respect to making or insuring of student loans.

For example, withholding an individuals driver's license solely because of nonpayment of a dischargeable debt is a violation of this section.  This same section prohibits private employers from discriminating against debtors with respect to promotions and advancements.  This includes termination as well.

In my experience, most people do not tell their employer about their bankruptcy.  They are not obligated to at all.  But, I have had numerous employers refer Bucks County people to me since their debts are impacting their job performance.  When people worry about their debts, they generally have major concerns and these concerns can generally be alleviated through a bankruptcy.

Violations of the Automatic Stay

If a creditor in your Bucks County bankruptcy continues to harass you, what can be done?

If you are filed, you are protected by the Automatic Stay.  I always like to say that the automatic stay is "sacred" in the bankruptcy code as it provides one of the main benefits of filing for a Bucks County bankruptcy -- you can be free of creditor harassment.

If however, an individual is injured by a willful violation of the automatic stay, they may recover actual damages, including costs and attorney's fees, from the creditor who violated the stay.  There is also potential for punitive damages when appropriate.

Under Section 362(h) of the bankruptcy code, damages may be recovered if the creditor knew of the stay and its actions were intentional.  Frequently, this is proven by showing the creditor listed on the petition and showing evidence of their continued violations.  Moreover, additional letters from the bankruptcy attorney to the creditor is helpful.

I just had this situation with a person from Feasterville.  He was sued by a creditor who was definitely listed on the bankruptcy petition.  I wrote a short, terse, and scary letter to the attorney representing the creditor.  In rapid fashion, the attorney withdrew the suit.  Why was the suit withdrawn so quickly?  Because the attorney knew the power of the automatic stay.

Eviction and Bankruptcy, Part 3

We have previously blogged about eviction and bankruptcy here and here.

There is a big exception to our previous posts -- even if you cure your deficiency and post the one month rent with the bankruptcy court as we discussed in Part 2, you may still not prevail if your eviction was based on the endangerment of the property or the illegal use of controlled substances on the property.  The landlord/lessor would have to file with the court and serve the Bucks County Bankruptcy lawyer a sworn certification stating that the eviction action was due to one of the aforementioned exceptions.

Eviction and Bankruptcy, Part 2

Previously, we spoke about the limited effect of a bankruptcy if a landlord has obtained a judgment in Bucks County.

But, there are potential fixes.  The Bucks County renter can keep the automatic stay in effect for 30 days (meaning -- not get evicted) IF, pursuant to 11 U.S.C. 362(l)(1), the debtor files with the bankruptcy petition and serves on the landlord a sworn certification under non-bankruptcy law that the debtor is permitted to cure the default that gave rise to the eviction AND by depositing with the clerk of the bankruptcy court a month of rent.

If, during the 30 day period, the debtor cures the entire default, then the automatic stay will be permanently reinstated unless the landlord objects.  If the landlord objects, a hearing will be held on the reinstatement of the stay within 10 days.

Eviction and Bankruptcy, Part 1

If a person in Bucks County files for bankruptcy and they are facing an eviction, they must first determine in if the lessor (i.e. landlord) has obtained a judgment of possession against the debtor prior to the filing of the bankruptcy case.

If a judgment has occurred, then the automatic stay does not stay/stop the continuation of an eviction or similar action for nonpayment of rent.  See 11 U.S.C. 362(b)(22).

BUT!  There are potential fixes.  In our next blog post, we will discuss potential strategies.

Cooperation with the Trustee in a Bucks County Bankruptcy

In a Bucks County bankruptcy, a debtor has numerous obligations with the court.  Your lawyer should have advised you about the paperwork requirements and your duty to disclose all of your assets.

There's an even more loose requirement -- 11 U.S.C. 521(a)(3) requires the debtor to cooperate with the Trustee to the extent necessary to enable the Trustee to perform his or her duties and the debtor, per 11 U.S.C. 727 (a)(6), (d)(3), must comply with all lawful orders of the bankruptcy court.

Thus, it is incumbent upon a debtor to stay in touch with their Bucks County Chapter 7 and 13 lawyer to discuss any additional obligations they may have.

Social media, being smart, and looking for fraud in Bucks County bankruptcy

I went to the 18th Annual Bankruptcy Institute in Philadelphia.  It is the main conference bankruptcy practitioners go to every year.  Yes, it is perhaps the most boring conference possible for 99% of the population.

But, I love the conference.  This year, the ethics panel discussed social media.  One particular item of interest was how social media can "catch" fraud and false pretense.  One of the U.S. Trustees told a story about how MySpace (back when it was popular) showed a debtor had a side business that was not listed on their petition.  At the 341 hearing, the debtor lied under oath when directly asked about additional businesses.  The Trustee informed the crowd that the person served jail over the fraud.

I recently have begun to use Google and Facebook to double check certain issues with clients.  So far, it has afforded me the opportunity to turn down a Bucks County bankruptcy client based upon issues I found online.  Obviously, I'm keeping the reasons vague for attorney-client confidentiality.  

Could the bankruptcy have gone smoothly?  Possibly.  But, I was reluctant to believe the potential client based upon the voluminous information I discovered.

It wasn't worth it for me as an attorney.  It could have been a major problem and one that possibly could have tarnished my reputation.

Sub-Prime Mortgages

My good friend who is also a bankruptcy lawyer in Burlington, NJ, sent me this pathetically funny video on the housing crisis and how we got to where we are.  The video is funny (watch out from some bad words) and uses stick figures to explain the least funny part of this economy -- people losing their homes.  When you have 6 minutes to spare, check it out.

Domestic Support Obligation

Most experienced bankruptcy lawyers know that a Domestic Support Obligation ("DSO") is a debt that is not dischargeable in bankruptcy.  Under 11 U.S.C. § 101(14A), a DSO is:

(14A) The term “domestic support obligation” means a debt that accrues before, on, or after the date of the order for relief in a case under this title, including interest that accrues on that debt as provided under applicable nonbankruptcy law notwithstanding any other provision of this title, that is—
(A) owed to or recoverable by—
(i) a spouse, former spouse, or child of the debtor or such child’s parent, legal guardian, or responsible relative; or
(ii) a governmental unit;
(B) in the nature of alimony, maintenance, or support (including assistance provided by a governmental unit) of such spouse, former spouse, or child of the debtor or such child’s parent, without regard to whether such debt is expressly so designated;
(C) established or subject to establishment before, on, or after the date of the order for relief in a case under this title, by reason of applicable provisions of—
(i) a separation agreement, divorce decree, or property settlement agreement;
(ii) an order of a court of record; or
(iii) a determination made in accordance with applicable nonbankruptcy law by a governmental unit; and
(D) not assigned to a nongovernmental entity, unless that obligation is assigned voluntarily by the spouse, former spouse, child of the debtor, or such child’s parent, legal guardian, or responsible relative for the purpose of collecting the debt.

Bucks County residents frequently come to me before, during, and after a divorce.  The biggest issue is whether they have debts with the former/separated spouse and what type of debt they have.   Shared credit card debt is likely not a DSO, unless it is assumed in lieu of a DSO.  Confusing?  Of course.  That's why you need to get a fresh start and get a free consultation immediately.

Why I Can't Stand "Debt Settlement" Companies for Bucks County Families and Individuals, Part 1 Billion

I was speaking to a Bucks County bankrupty client today who had tried "debt settlement".  I Googled the company's name and included "scam" in the search.  The first result was intriguing.

What is completely buried in the Terms of Agreement with the debt settlement company, which is highly unlikely to be slowly, and exhaustively, explained to the client is that debt settlement is that settled or forgiven debt is taxable.  But, discharged debt in a bankruptcy is not taxable.

So, not only does debt settlement not work, but you get hit with a tax bill at the end.