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Who is a “family fisherman”? One of a series

by David Leibowitz, Illinois and Wisconsin Bankruptcy Attorney · Posted in Benefits of Bankruptcy

The Bankruptcy Code likes “family fishermen.”  It’s not easy to make a living as a fishermen.  In fact, statistics demonstrate that family fishermen have had a difficult time eking out a living.  This is particularly important in coastal states such as Maine, Louisiana, Mississippi, Maryland, Florida and Alaska.

You may have heard that “family farmers” are entitled to special treatment under the Bankruptcy Code.  The same is true for “family fishermen”.

The Bankruptcy Code tells us who is a “family fisherman” in its own convoluted sort of way.  A “family fisherman” is a person, a married couple, or a corporation involving one family which makes a living in a “commercial fishing operation”.  But not too much of a living.  No more than $1.5 million gross income per year.  Most of the family debt except for one dwelling has to arise from the “commercial fishing operation.”  A “family fisherman” must have stable income so as to be able to make regular payments toward debt.

A “commercial fishing operation” means a business engaged in catching or growing things people eat which live in water.  And a “commercial fishing vessel” means a vessel used in a “commercial fishing operation.”

“Family fisherman” can get special treatment in bankruptcy .  They can file chapter 12. Chapter 12 is a special part of the Bankruptcy Code designed to help “family fishermen” and “family farmers” deal with their debt.  Chapter 12 can help in many ways.  But one of the most important ways it can help is to allow a debtor modify a mortgage on residential real estate.  Bankruptcy judges have done this for years with no apparent harm to the economy.

Bankruptcy Courts can use what they have learned in Chapter 12 to help others in Chapter 13  with mortgage modifications of loans which are underwater.  The Senate said no last time they had a chance.  Maybe they will try again now that the Obama mortgage plan is failing so miserably.

More about chapter 12 will follow in future articles.  Lakelaw represents family farmers in chapter 12 cases in Northern Illinois and Southern Wisconsin.

About David Leibowitz, Illinois and Wisconsin Bankruptcy Attorney

David Leibowitz holds a B. A. in Economics from Northwestern University and received his J.D., cum laude, from Loyola University of Chicago School of Law where he also served as Note Editor of the law review. Admitted to the Illinois and Wisconsin bars, he is the managing member of Lakelaw, an interstate law firm with offices in Chicago, Skokie and Waukegan in Illinois and Kenosha, Wisconsin. He is nationally recognized for his work in identifying and pursuing mortgage related claims in the context of bankruptcy. David is a member of both the Illinois and Wisconsin bars and has practiced in bankruptcy courts throughout the country. He is a member of the American Bankruptcy Institute where he is the Co-Chair of the Commercial Fraud Committee. He is ta frequent contributor to the ABI Journal and speaker at ABI events. He is an author and editor in chief of the American Bankruptcy Institute Fraud Manual published in 2010. He is also a member and Director of the National Association of Bankruptcy Trustees, a member and frequent speaker for the National Association of Consumer Bankruptcy Attorneys and numerous state and local bar associations. He is Board Certified by the American Board of Certification in both Consumer Bankruptcy Law and Business Bankruptcy Law. David is also the publisher of Lakeblawg, www.lakelaw.com/lakeblawg, a blog dedicated to consumer and small business bankruptcy and mortgage foreclosure defense.

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