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Empirical Study of BAPCPA. The first report of the effects of BAPCPA, based on data from a random national sampling of debtors, has been published. R.M. Lawless, et al., Did Bankruptcy Reform Fail? An Empirical Study of Consumer Debtors, 82 AM. BANKR. L. J. 349 (2008). A summary of the article is found in Melanie Sonnenborn & John A.E. Pottow, 2009 Consumer Bankruptcy Project‹ Empirical Analysis Suggests Initial Failure of BAPCPA to Produce Intended Results, NORTON BANKR. LAW ADVISER (Feb. 2009).
Credit Briefing Briefing on same calendar day as filing case satisfies § 109(h). Reversing the bankruptcy court and acknowledging split of authority, the BAP holds that briefing may occur on the same calendar day as the filing; "a debtor qualifies as a debtor under § 109(h) so long as he or she completes the required credit counseling at any time between 180 days before, and the moment of, filing of the petition." In re Francisco, 386 B.R. 700, 705 (B.A.P. 10th Cir. 2008).
Prebankruptcy credit briefing doesn't apply in involuntary case. After filing of an involuntary Chapter 7, which was not contested, the debtor moved for an extension of time to obtain the § 109(h) credit briefing. The motion was moot, concluding that § 109(h) doesn't apply to involuntary debtors. In re Sims, 2009 WL 161343 (Bankr. D. Kan. Jan. 7, 2009).
Debtor's inability to pay for briefing is no excuse. Recognizing that counseling agencies are statutorily required to provide services without regard to ability to pay, financial difficulty is not an exigent circumstance justifying waiver. In re Sherry, 2008 WL 3876595 (Bankr. N.D. Ohio Aug. 20, 2008); see also In re Palacios, 2008 WL 700968 (Bankr. E.D. Va. Mar. 13, 2008).
Section 527(b)'s application of "debt relief agency" status to attorneys is constitutional, reversing district court's holding that § 526(a)(4) is facially unconstitutional. In appeal from Hersh v. United States, 347 B.R. 19 (N.D. Tex. 2006), the Fifth Circuit held on Dec. 18, 2008, that bankruptcy attorneys do qualify as debt relief agencies under § 101(12A) and for the application of that agency status under § 526(b), agreeing with Milavetz, Gallop & Milavetz, P.A., et al. v. United States, 541 F.3d 785, 792 (8th Cir. 2008), that "attorneys that provide 'bankruptcy assistance' to 'assisted persons' are 'debt relief agencies." Section 101(12A) does not specifically include attorneys but neither does it exclude them. As to § 526(a)(4)'s prohibition against advising an "assisted person" to "incur more debt in contemplation of such person filing a case under" Title 11, the Fifth Circuit holds that the provision is not facially unconstitutional, here disagreeing with the Milavetz panel.
©2010 Keith M. Lundin
