Limited Scope of Representation
Posted: Sat Dec 20, 2014 6:20 pm
Mike:
I don't want a rookie lawyer to walk away and leave someone pro se, I want the lawyer to refer the debtor to someone with experience.
If the inexperienced lawyer is forced to defend, the debtor likely, will not have a good result.
If the debtor realizes that the lawyer is stuck doing the defense for free, the debtor won't want to hire someone who can present a good defense.
d
Dennis McGoldrick, 350 S. Crenshaw Bl., #A207B, Torrance, Ca 90503 310-328-1001-voice
> On Dec 20, 2014, at 9:11 AM, Michael Avanesian michael@avanesianlaw.com [cdcbaa] wrote:
>
> At the end of the day, the Judges are not going to force us to take on APs.
>
> Regarding "Do you want the rookie lawyer, who cannot tell what the result will be, to be required to lose the adversary, due to their inexperience?" Assume a rookie lawyer files bankruptcy for client in a situation where it's clear that client would get hit with an AP.
>
> You would like the rookie to be able to walk away leaving the former client pro se. I am not convinced that's the best solution. I don't know what is. This was a throwaway question though. The focus of the committee/judges is on 341 meetings and amending schedules following those meetings.
>
> I anticipate no unbundling of a bk through amendments to a case. Everything else will continue to be unbundleable.
>
> Sincerely,
> Michael Avanesian
>
>> On Fri, Dec 19, 2014 at 8:57 PM, cdcbaa cdcbaamailbox@gmail.com [cdcbaa] wrote:
>>
>> Mike:
>>
>> This analysis is wrong. You can make this analysis, and I can make this analysis, but a rookie lawyer cannot. Do you want the rookie lawyer, who cannot tell what the result will be, to be required to lose the adversary, due to their inexperience?
>>
>> The whole idea that everyone should be omniscient is crazy.
>>
>> d
>>
>> Dennis McGoldrick, 350 S. Crenshaw Bl., #A207B, Torrance, Ca 90503 310-328-1001-voice
>>
>>
>>> On Dec 19, 2014, at 4:57 PM, Michael Avanesian michael@avanesianlaw.com [cdcbaa] wrote:
>>>
>>>
>>> I am on the committee too. I am possibly related to Draco.
>>>
>>> In my opinion (apology for the obvious), there must be informed consent for an attorney to avoid having to represent a client in an adversary.
>>>
>>> When a client walks into your office, you should be able to reliably predict what will happen during the course of a Chapter 7 bankruptcy. If you can't, you're not spending enough time analyzing the client's situation.
>>>
>>> Your clients will fall into three categories:
>>>
>>> 1. Virtual certainty that a particular service, like adversary, will not be necessary.
>>> 2. Virtual certainty that a particular service, like adversary, WILL be necessary.
>>> 3. Toss up but there is a likelihood.
>>>
>>> Why shouldn't your clients, particularly those in categories 2 and 3, be given informed consent that the bankruptcy is going to (or may) throw their life in a tailspin? An analysis of those risks should be mandatory.
>>>
>>> It's not okay to throw them in a chapter and walk away.
>>>
>>> I sympathize with Mark's point in particular. The schedules he prepares are meticulous and those of his clients who don't need representation are not forced to pay a premium $50 to $100 for an attorney to hold their hands at the 341. Is the Central District willing to tap those people for an extra $50 to $100 for the benefit of all those who are scared to death of the Trustee, often their first and only experience with the judiciary, who suddenly have no attorney and need to amend their schedules. They have no idea what that even means. It's an easy yes for me.
>>>
>>> -Mike
>>>
>>>> On Fri, Dec 19, 2014 at 3:12 PM, jhayes@hayesbklaw.com [cdcbaa] wrote:
>>>>
>>>> DeLuca v. Seare (In re Seare) , --- BR --- (9th Cir. BAP Aug, 2014)
>>>>
>>>> Issue: Did the court properly sanction the chapter 7 debtor's attorney for not representing the debtor in a non-dischargeability action? >>>>
>>>> Holding: Yes, for many reasons but most importantly for not properly defining the goals of the representation at the outset and for not getting informed consent to the "unbundling."
>>>>
>>>> Standard: abuse of discretion
>>>>
>>>> Judge Bruce Markell, Nevada
>>>>
>>>> Kirscher, Taylor, Jury
>>>>
>>>> Opinion by Kirscher, concurrence by Jury
>>>>
>>>> Here the chapter 7 debtor had sued his former employer prepetition in District Court for sexual harassment but later he admitted that he had "embellished" the claims. Based on that, the District Court dismissed the case and entered judgment against him for attorneys fees of $67,000. The debtor then filed chapter 7 using attorney DeLuca. The employer filed a 523 complaint against the debtor and DeLuca told the debtor to find someone else to defend him. The debtor filed an answer in pro per and attended the status conference. At that time, Judge Markell issued an OSC against DeLuca re why he should not be sanctioned for "Failing to Represent Debtor in the . . . Adversary Proceeding. DeLuca responded saying that his 19 page retainer agreement expressly excluded adversary proceedings from the representation. In fact the debtor initialed every page of the retainer agreement although apparently no one from the DeLuca office went through it with him. Also DeLuca tried to dodge responsibility by saying that he had no reason to believe that a complaint may be on the way. The court clearly did not believe that and said that it was so obvious it was coming there might not have been a reason for filing the case in the first place. After an evidentiary hearing, the court ordered DeLuca to return the $2,000 fee and "that for the next two years DeLuca provide a copy of the Sanctions Opinion to future adversary clients whose case he declines." DeLuca appealed.
>>>>
>>>>
>>>>
>>>> The BAP affirmed. In a very long opinion, the BAP looked first (as did Markell) at the Nevada Rules of Professional Responsibility. "Specifically, the court found that as a result of a lack of communication at the initial consultation DeLuca failed in his primary duty ascertaining Debtors objectives and defining the goals of the representation." The big problem according to Markell and the BAP is that DeLuca spent very little time with the client at the outset and left the rest to his staff. The "unbundling" "decision" was not made with any thought - it was part of the preprinted retainer agreement. The retainer agreement said that representation in adversary proceedings would be extra. "The bankruptcy court held that DeLuca had further violated NRPC 1.2(c) because he did not obtain Debtors informed consent in limiting the scope of his representation." When DeLuca later told the debtor he would not represent him in the adversary, he "changed" the basis of the agreement.
>>>>
>>>>
>>>>
>>>> Markell also found and the BAP agreed that DeLuca violated section 707(b)(4)(C) by failing to "perform a reasonable investigation." He also violated 526(a) and 528(a) by "failing to accurately explain that he would not represent Debtors in an adversary proceeding and the risks Debtors could face in bankruptcy." He violated 528(a) because he did not sign the retainer agreement and
>>>>
>>>>
>>>>
>>>> "because the Retainer Agreement did not 'clearly and conspicuously' explain the scope of services and fees. Id. Specifically, DeLuca excluded services using technical terms like 'nondischargeability allegations' and 'adversary proceedings,' which a layperson would not likely understand. Further, the standard form contract did not relate these services to a client additional services were likely to be needed, Debtors had no way of knowing which exclusions were likely to apply and what the chances were of facing increased legal fees."
>>>>
>>>>
>>>>
>>>> Judge Jury's concurrence says the unbundling is a "minefield" but makes an effort to explain when it is appropriate. "If done correctly, unbundling may be key to competent consumer bankruptcy attorneys providing much needed representation to debtors at an affordable price. Without the ability to unbundle adversaries, the flat fee which a consumer attorney would need to charge for basic bankruptcy representation might become prohibitive and exacerbate the already existing problem of pro se filings." It was "the initial intake interview that tripped DeLuca up because he did not properly define the goal of the representation of [the debtor]." "All the other ethical and statutory violations found by the bankruptcy judge flowed from this initial deficiency in the limited scope representation." She ended with her "suggestions for such attorneys to avoid violating ethical rules and the Bankruptcy Code when they limit the scope of representation of consumer debtors."
>
>
On Dec 19, 2014, at 4:57 PM, Michael Avanesian michael@avanesianlaw.com [cdcbaa] <cdcbaa@yahoogroups.com> wrote:
I am on the committee too. I am possibly related to Draco. In my opinion (apology for the obvious), there must be informed consent for an attorney to avoid having to represent a client in an adversary. When a client walks into your office, you should be able to reliably predict what will happen during the course of a Chapter 7 bankruptcy. If you can't, you're not spending enough time analyzing the client's situation. Your clients will fall into three categories: 1. Virtual certainty that a particular service, like adversary, will not be necessary.2. Virtual certainty that a particular service, like adversary, WILL be necessary.3. Toss up but there is a likelihood. Why shouldn't your clients, particularly those in categories 2 and 3, be given informed consent that the bankruptcy is going to (or may) throw their life in a tailspin? An analysis of those risks should be mandatory. It's not okay to throw them in a chapter and walk away. I sympathize with Mark's point in particular. The schedules he prepares are meticulous and those of his clients who don't need representation are not forced to pay a premium $50 to $100 for an attorney to hold their hands at the 341. Is the Central District willing to tap those people for an extra $50 to $100 for the benefit of all those who are scared to death of the Trustee, often their first and only experience with the judiciary, who suddenly have no attorney and need to amend their schedules. They have no idea what that even means. It's an easy yes for me. -MikeOn Fri, Dec 19, 2014 at 3:12 PM, jhayes@hayesbklaw.com [cdcbaa] <cdcbaa@yahoogroups.com> wrote:
DeLuca v. Seare (In re Seare) , --- BR ---
(9th Cir. BAP Aug, 2014)
Issue: Did the court properly sanction the chapter 7 debtor's
attorney for not representing the debtor in a non-dischargeability action?
Holding: Yes, for many reasons
but most importantly for not properly defining the goals of the representation
at the outset and for not getting informed consent to the
"unbundling."
Standard:
abuse of discretion
Judge Bruce Markell, Nevada
Kirscher, Taylor, Jury
Opinion by Kirscher, concurrence by Jury
Here the chapter 7 debtor had sued his former employer prepetition in District
Court for sexual harassment but later he admitted that he had "embellished"
the claims. Based on that, the District
Court dismissed the case and entered judgment against him for attorneys fees of
$67,000. The debtor then filed chapter 7
using attorney DeLuca. The employer
filed a 523 complaint against the debtor and DeLuca told the debtor to find
someone else to defend him. The debtor
filed an answer in pro per and attended the status conference. At that time, Judge Markell issued an OSC
against DeLuca re why he should not be sanctioned for "Failing to
Represent Debtor in the . . . Adversary Proceeding. DeLuca responded saying that his 19 page
retainer agreement expressly excluded adversary proceedings from the
representation. In fact the debtor
initialed every page of the retainer agreement although apparently no one from
the DeLuca office went through it with him.
Also DeLuca tried to dodge responsibility by saying that he had no
reason to believe that a complaint may be on the way. The court clearly did not believe that and
said that it was so obvious it was coming there might not have been a reason
for filing the case in the first place.
After an evidentiary hearing, the court ordered DeLuca to return the
$2,000 fee and "that for the next two years DeLuca provide a copy of the
Sanctions Opinion to future adversary clients whose case he declines." DeLuca appealed.
The BAP affirmed. In a very long opinion, the BAP looked first
(as did Markell) at the Nevada Rules of Professional Responsibility. "Specifically, the court found that as
a result of a lack of communication at the initial consultation DeLuca failed
in his primary duty ascertaining Debtors objectives and defining the goals
of the representation." The big
problem according to Markell and the BAP is that DeLuca spent very little time
with the client at the outset and left the rest to his staff. The "unbundling" "decision"
was not made with any thought - it was part of the preprinted retainer
agreement. The retainer agreement said
that representation in adversary proceedings would be extra. "The bankruptcy court held that DeLuca
had further violated NRPC 1.2(c) because he did not obtain Debtors informed
consent in limiting the scope of his representation." When DeLuca later told the debtor he would
not represent him in the adversary, he "changed" the basis of the
agreement.
Markell also found and the BAP agreed that
DeLuca violated section 707(b)(4)(C) by failing to "perform a reasonable
investigation." He also violated
526(a) and 528(a) by "failing to accurately explain that he would not
represent Debtors in an adversary proceeding and the risks Debtors could face
in bankruptcy." He violated 528(a)
because he did not sign the retainer agreement and
"because
the Retainer Agreement did not 'clearly and conspicuously' explain the scope of
services and fees. Id. Specifically,
DeLuca excluded services using technical terms like 'nondischargeability
allegations' and 'adversary proceedings,' which a layperson would not likely
understand. Further, the standard form
contract did not relate these services to a clients particular case, and,
without clarification from DeLuca about which additional services were likely
to be needed, Debtors had no way of knowing which exclusions were likely to
apply and what the chances were of facing increased legal fees."
Judge Jury's concurrence says the unbundling is
a "minefield" but makes an effort to explain when it is
appropriate. "If done correctly,
unbundling may be key to competent consumer bankruptcy attorneys providing much
needed representation to debtors at an affordable price. Without the ability to
unbundle adversaries, the flat fee which a consumer attorney would need to
charge for basic bankruptcy representation might become prohibitive and
exacerbate the already existing problem of pro se filings." It was "the initial intake interview
that tripped DeLuca up because he did not properly define the goal of the
representation of [the debtor]."
"All the other ethical and statutory violations found by the
bankruptcy judge flowed from this initial deficiency in the limited scope
representation." She ended with her
"suggestions for such attorneys to avoid violating ethical rules and the
Bankruptcy Code when they limit the scope of representation of consumer debtors."
The post was migrated from Yahoo.