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retaining liens and violation of stay
I have a debtor client I represent here who is a defendant in a real
estate case filed pre-petition in NY. He owed his attorney money and
was thus scheduled as a creditor in the bankruptcy case.
Said defense attorney has now filed a motion to withdraw as counsel (for
failure to pay fees) but has also sought an order "granting said counsel
a retaining lien upon defendant's files and documents in the amount of
$2,714.50".
Does anyone know what a retaining lien is and should I make any noise
about this violating the automatic stay? It sounds like he's just
seeking a lien against the client files (which would be strictly
prohibited here in California) and will only release them upon payment
of the debt owed to him. Creating a security interest post petition is
a violation of the stay. On the other hand, the debt owed by the debtor
will be discharged in his bankruptcy (presumably) so it may end up being
a "who cares" situation.
Any thoughts?
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Mark J. Markus
Law Office of Mark J. Markus
11684 Ventura Blvd. PMB #403
Studio City, CA 91604-2652
(818)509-1173 (818)509-1460 (fax)
web: http://www.bklaw.com/
This Firm is a Qualified Federal Debt Relief Agency (see what this means at http://bklaw.com/bankruptcy-blog/2008/0 ... efinition/)
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