A lesson for the rest of us ...

Hats off to Tony Mankus for making a difference. I suggest that each of us send a version of this letter to Dick Durbin. Who's with me? Senator Richard J. Durbin

United States Senate

Washington, D.C. 20510

RE: Bankruptcy Attorney Liability Provisions in S. 256, the “Bankruptcy Abuse Prevention and Consumer Protection Act of 2005”

Dear Senator Durbin:

As the Senate considers S. 256, the “Bankruptcy Abuse Prevention and Consumer Protection Act of 2005,” I urge you to support the two separate amendments sponsored by Sen. Jeff Bingaman (D-NM) and Sen. Russ Feingold (D-WI), respectively, that would remove the three harmful attorney liability provisions from the bill. These amendments—which are supported by the American Bar Association and over 15 state bars around the country—would delete the provisions in the bill requiring debtor bankruptcy attorneys to: (1) certify the accuracy of the debtor’s bankruptcy schedules, under penalty of harsh court sanctions; (2) certify the ability of the debtor to make future payments under a reaffirmation agreement; and (3) identify and advertise themselves as “debt relief agencies” subject to a host of new intrusive regulations that would interfere with the confidential attorney-client relationship.

These attorney liability provisions in S. 256 would be a disaster for the nation’s bankruptcy system for many reasons, including the following:

By holding debtors’ attorneys personally liable for the accuracy of their clients’ schedules, the measure would force the attorney to hire private investigators and appraisers to independently verify the existence and value of all the client’s assets, adding thousands of dollars to the cost of representing a debtor in bankruptcy. Most individual debtors will not be able to afford these new expenses, resulting in many thousands of pro se debtors clogging up the court system.

These provisions will create a harsh new liability standard for debtors’ attorneys who do not conduct a lengthy investigation and appraisal of the client’s assets. If these costly steps are not taken and the Chapter 7 petition is dismissed or converted to a Chapter 13, the court could then impose harsh sanctions and civil penalties on the attorney personally. In addition, most malpractice carriers are expected to exclude this new liability from coverage under their policies. As a result of these harsh new liability provisions, many attorneys will no longer agree to represent debtors in bankruptcy. In addition, because the new certification standards apply to all debtors’ attorneys, whether or not they charge a fee, these provisions will strongly discourage lawyers from providing essential pro bono bankruptcy services to the very debtors who need them most. In order to avoid these problems, I urge you to cosponsor and/or vote for the Bingaman Amendment and the Feingold Amendment.

Thank you for your consideration.

Sincerely,

Tony Mankus, Esq.

cc: Julie M. Strandlie, Director, Grassroots Operations/Legislative Counsel, ABA

Nancy Ann Peterman, Chairman, Bankruptcy Committee, CBA

M. Hedayat, Chairman, Bankruptcy Committee, DCBA