Supreme Court to Decide Three Bankruptcy Cases
By Kent Anderson, Oregon Bankruptcy Attorney on Oct 1, 2009 in Bankruptcy Cases & Legislation
The US Supreme Court plans to hear oral argument on several important bankruptcy cases in its 2009/10 term. One case, Milavetz Gallop v. U. S., deals with the relationship between bankruptcy lawyers and their clients. The case of U. S. Student Aid Funds v. Espinosa will determine what type of procedural steps must be taken to discharge a student loan. Finally, Schwab v. Reilly, a case in which the method of claiming an exemption was disputed will be heard.
The Milavetz Gallop case deals with a requirement in the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 that bankruptcy lawyers call themselves “Debt Relief Agencies.” The Act further required other mandated “disclosures” and restricted the advice that a bankruptcy lawyer can give to a client. All three of these issues are before the court for decision.
A similar case, Connecticut Bar Association v. U. S., included Eugene S Melchionne, President of Bankruptcy Law Network, as one of its plaintiffs. A decision on Milavetz Gallop will determine the result in that case as well. The free speech issue has been addressed by other authors in this weblawg.
The Espinosa case was appealed to the Supreme Court from the 9th Circuit Court of Appeals after the appeals court decided that a student loan could be discharged by the provisions of a confirmed Chapter 13 plan. The student lender argued that an adversary proceeding was required to obtain the discharge.
The National Association of Consumer Bankruptcy Attorneys has submitted a brief in support of consumer bankruptcy attorneys in the Schwab v. Reilly case. The issues before the Supreme Court are the value of the asset exempted in bankruptcy and the time limit for objection by the trustee to the exemption.
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