Bankruptcy attorneys across the country are vigorously split over the practice of representing separated spouses. Those in favor point out that it is permitted, even contemplated by the Bankruptcy Code, and it allows debtors of limited income and assets to save bankruptcy fees and costs.
Those opposed reach that position because of potential or actual conflicts of interest, which include the possibility of a dischargeable property division obligation in a Chapter 13 filing which is not allowed in Chapter 7, the need to disclose potential spouse abuse claims as assets, and the need to disclose all asset, income, and other information which one spouse might want to be kept secret from the other.
An advance copy of a working paper on Best Practices for Debtors’ Attorneys, scheduled for publication by a national legal organization in October, recommends that “The attorney may want to advise that each spouse retain separate counsel when spouses maintain separate financial existences.”
This can be a situation of being penny-wise but pound-foolish. Certainly you save the fees of a separate attorney and filing, but you just might have needed separate advice and, after the filing, it can be too late.
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