The Supreme Court justices were presented with two cases involving bankruptcy issues this week. One relates to the discharge of student loans in Chapter 13, and the other challenges proposed changes to the Bankruptcy Code. I discussed both cases in a blog last month.
The first instance refers to the case of U. S. Student Aid Funds v. Espinosa which will determine the type of procedural steps required to discharge a student loan. The latter refers to the case of Milavetz Gallop v. United States and will have the greatest impact on bankruptcy lawyers. There is more information on the issues involved in this case in my blog of July 13th.
The attorney for the law firm Milavetz, Gallop & Milavetz P.A., G. Eric Brunstad commented after the presentation to the justices. He said that the Bankruptcy Code of 2005 “basically proscribes or tells the lawyer you can’t give perfectly legitimate advice, and that’s wrong. The government has no compelling reason to prohibit that kind of advice.” An attorney with the Solicitor General’s office, William M. Jay, disagrees with this notion. He told the Supreme Court that the statute merely prevents debtors from gaming the system, not from obtaining legitimate advice. A transcript of the arguments is available at the supremecourtus.gov website.
The justices appeared to be in consensus about the provision being a problem, but as of yet it is uncertain what changes they will make to the Bankruptcy Code. Their decision should be handed down within the next ninety days.
If you live in Denver, Aurora, Arvada, Brighton, Broomfield, Commerce City, Englewood, Highlands Ranch, Lakewood, Lafayette, Littleton, Northglenn, Westminster, Wheat Ridge, or Golden, Colorado, please feel free to contact me with any questions.
Kevin D. Heupel, Colorado Bankruptcy lawyer, 303-955-7570, COBankruptcyHelpEmail, free-consultation form.
