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RARA Fees After Case Converted to Chapter 7
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That would violate the priority of various claims. Chapter 7 admin claims
take priority and have first draw on property of the estate.
David A. Tilem
Certified Bankruptcy Specialist*
Law Offices of David A. Tilem (a debt relief agency)
206 N. Jackson Street, #201, Glendale, CA 91206
Tel: 818-507-6000 Fax: 818-507-6800
* Bankruptcy specialist cert. by State Bar of CA Bd of Legal
Specialization.
larry@lsimonslaw.com
Sent: Thursday, January 28, 2010 7:26 AM
To: cdcbaa@yahoogroups.com
Subject: Re: [cdcbaa] RARA Fees After Case Converted to Chapter 7
I wonder if in the motion to convert, you can put a provision to have the
attorney fees paid?
Sent via BlackBerry by AT&T
_____
The post was migrated from Yahoo.
Im not sure that is a solution to the problem. There is not
really a motion filed to convert from 13 to 7, just the Debtors
Notice of Conversion on mandatory local form F 1017-1.4. I do not
believe that notice even goes to the judge unless there is some later
objection raised. A separate ex parte application perhaps? However,
that is a whole bunch of work that may not be worth undertaking for
the dollar figures involved.Mark T. Jessee
Law Offices of Mark T. Jessee
"A Debt Relief Agency"
50 W. Hillcrest Drive, Suite 200
Thousand Oaks, CA 91360
(805) 497-5868
On Thu 28/01/10 7:26 AM , larry@lsimonslaw.com sent:
I wonder if in the motion to convert, you can put a provision to
have the attorney fees paid?
Sent via BlackBerry by AT&T
FROM: Mark T.Jessee DATE: Thu, 28 Jan 2010 01:59:59 -0600 TO:
SUBJECT: Re: [cdcbaa] RARA Fees After Case Converted to Chapter 7
I assume the plan had not been confirmed yet or I would argue the
plan terms were binding. Nate Berneman told me the same thing happened
that happened to you happened to him in one of his valley cases last
year. I faced this issue myself a couple months ago.
Local Rule 3015(v) only speaks to dismissal.
(7) Payment of Fees Upon Dismissal. Unless otherwise ordered by the
court, the
chapter 13 trustee must disburse to the debtors attorney as soon
as practicable
after dismissal any portion of the balance on hand which has been
tendered to the
chapter 13 trustee for payment of the RARA fees, provided:
(A) A RARA was signed by the debtors attorney and the debtor,
filed, and
served on the chapter 13 trustee; and
(B) The debtors case is dismissed prior to or at the hearing on
confirmation of
the plan.
Local Rule 3015(v)says nothing regarding attorney fees upon
conversion, nor does any other local rule as far as I can see.
The consequences under these circumstances puts the attorney in
clear conflict of interest with their debtor clients. It should not
be that way! It brings to mind the lovely refrain: No good deed goes
unpunished! Every time there is a potential for the case to be
dismissed when we are owed fees and money is in the trustee's hands,
we face a dilemma: Either we counsel our client's to convert knowing
we will thus in all likelihood not be paid (unless it is a rare asset
case which pays us a couple years later), or we risk breaching our
duty to represent our client's best interests by not informing them of
the right to convert the case or worse by recommending dismissal when
it is not in their best interests to do so. I believe Rule of
Professional Conduct 3-310(B)(4) requires us to inform the client in
writing that we have a financial adverse interest to them in making
the decision to dismiss or convert in such circumstances.
Even though I knew I would not likely be paid as a result I advised
the client in writing more than once to convert the case rather than
allow it to be dismissed at the confirmation hearing. Very
frustrating, but better than a disciplinary complaint from the state
bar....
Mark T. Jessee
Law Offices of Mark T. Jessee
"A Debt Relief Agency"
50 W. Hillcrest Drive, Suite 200
Thousand Oaks, CA 91360
(805) 497-5868
On Wed 27/01/10 10:17 PM , "lsimons_esq" larry@lsimonslaw.com sent:
I had a recent case whereby I agreed to take a portion of my fees in
a chapter 13 through the plan. The debtors were deficient and the case
was going to be dismissed. I asked the court to hold off on dismissing
the case for a week so I could confer with the debtors re dismissal.
Debtors decided to let case be dismissed. Trustee subsequently refunds
rest of fee due to me under RARA back to debtor. Trustee claims that
when case is converted, fees due under a RARA are not paid per the
Local Rules. Never heard of that before (I had a provision in my plan
that attorney fees to be paid nothwithstanding dismissal or
conversion). Does this sound correct?
Links:
[1] mailto:larry@lsimonslaw.com?subjectRe: [cdcbaa] RARA Fees After
Case Converted to Chapter 7
[2] mailto:cdcbaa@yahoogroups.com?subjectRe: [cdcbaa] RARA Fees
After Case Converted to Chapter 7
[3]
The post was migrated from Yahoo.
I assume the plan had not been confirmed yet or I would argue the
plan terms were binding. Nate Berneman told me the same thing happened
that happened to you happened to him in one of his valley cases last
year. I faced this issue myself a couple months ago.
Local Rule 3015(v) only speaks to dismissal.
(7) Payment of Fees Upon Dismissal. Unless otherwise ordered by the
court, the
chapter 13 trustee must disburse to the debtors attorney as soon
as practicable
after dismissal any portion of the balance on hand which has been
tendered to the
chapter 13 trustee for payment of the RARA fees, provided:
(A) A RARA was signed by the debtors attorney and the debtor,
filed, and
served on the chapter 13 trustee; and
(B) The debtors case is dismissed prior to or at the hearing on
confirmation of
the plan.
Local Rule 3015(v)says nothing regarding attorney fees upon
conversion, nor does any other local rule as far as I can see.
The consequences under these circumstances puts the attorney in
clear conflict of interest with their debtor clients. It should not
be that way! It brings to mind the lovely refrain: No good deed goes
unpunished! Every time there is a potential for the case to be
dismissed when we are owed fees and money is in the trustee's hands,
we face a dilemma: Either we counsel our client's to convert knowing
we will thus in all likelihood not be paid (unless it is a rare asset
case which pays us a couple years later), or we risk breaching our
duty to represent our client's best interests by not informing them of
the right to convert the case or worse by recommending dismissal when
it is not in their best interests to do so. I believe Rule of
Professional Conduct 3-310(B)(4) requires us to inform the client in
writing that we have a financial adverse interest to them in making
the decision to dismiss or convert in such circumstances.
Even though I knew I would not likely be paid as a result I advised
the client in writing more than once to convert the case rather than
allow it to be dismissed at the confirmation hearing. Very
frustrating, but better than a disciplinary complaint from the state
bar....
Mark T. Jessee
Law Offices of Mark T. Jessee
"A Debt Relief Agency"
50 W. Hillcrest Drive, Suite 200
Thousand Oaks, CA 91360
(805) 497-5868
On Wed 27/01/10 10:17 PM , "lsimons_esq" larry@lsimonslaw.com sent:
I had a recent case whereby I agreed to take a portion of my fees in
a chapter 13 through the plan. The debtors were deficient and the case
was going to be dismissed. I asked the court to hold off on dismissing
the case for a week so I could confer with the debtors re dismissal.
Debtors decided to let case be dismissed. Trustee subsequently refunds
rest of fee due to me under RARA back to debtor. Trustee claims that
when case is converted, fees due under a RARA are not paid per the
Local Rules. Never heard of that before (I had a provision in my plan
that attorney fees to be paid nothwithstanding dismissal or
conversion). Does this sound correct?
Links:
[1] mailto:larry@lsimonslaw.com?subjectRARA Fees After Case
Converted to Chapter 7
[2] mailto:cdcbaa@yahoogroups.com?subjectRARA Fees After Case
Converted to Chapter 7
[3]
The post was migrated from Yahoo.
You could do two means tests. I have also listed the differential
between the housing payments for two households of appropriate size
minus the figure for the household of the combined size in the Local
Standards: housing and utilities; adjustment line. I provide an
explanation and it basically is the same number as two separate means
tests. I have never had a problem in Chapter 7 cases doing this. I
have not had to face the issue in Chapter 13 but I do not care for the
USTP Position Concerning Chapter 13 Disposable Income Test on its
website which states "Debtors and Joint Debtor's are entitled to only
one local standard mortgage/rent payment, even if maintaining two
separate households.
Mark T. Jessee
Law Offices of Mark T. Jessee
"A Debt Relief Agency"
50 W. Hillcrest Drive, Suite 200
Thousand Oaks, CA 91360
(805) 497-5868
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On Wed 27/01/10 10:17 PM , "lsimons_esq" larry@lsimonslaw.com sent:
I had a recent case whereby I agreed to take a portion of my fees in
a chapter 13 through the plan. The debtors were deficient and the case
was going to be dismissed. I asked the court to hold off on dismissing
the case for a week so I could confer with the debtors re dismissal.
Debtors decided to let case be dismissed. Trustee subsequently refunds
rest of fee due to me under RARA back to debtor. Trustee claims that
when case is converted, fees due under a RARA are not paid per the
Local Rules. Never heard of that before (I had a provision in my plan
that attorney fees to be paid nothwithstanding dismissal or
conversion). Does this sound correct?
Links:
[1] mailto:larry@lsimonslaw.com?subjectRARA Fees After Case
Converted to Chapter 7
[2] mailto:cdcbaa@yahoogroups.com?subjectRARA Fees After Case
Converted to Chapter 7
[3]
The post was migrated from Yahoo.
I had a recent case whereby I agreed to take a portion of my fees in a chapter 13 through the plan. The debtors were deficient and the case was going to be dismissed. I asked the court to hold off on dismissing the case for a week so I could confer with the debtors re dismissal. Debtors decided to let case be dismissed. Trustee subsequently refunds rest of fee due to me under RARA back to debtor. Trustee claims that when case is converted, fees due under a RARA are not paid per the Local Rules. Never heard of that before (I had a provision in my plan that attorney fees to be paid nothwithstanding dismissal or conversion). Does this sound correct?
The post was migrated from Yahoo.