Just before the Great Recession, the prevailing attitude in Washington (thanks to healthy palm greasing by the credit card industry) was that anyone who filed bankruptcy must be a scumbag. So, in 2005, Congress rewrote the American bankruptcy laws…entirely. Basically threw out the existing laws and started over. The goal: make it harder for people to file bankruptcy. They figured it was a good idea to deter you from filing: You, the downsized and outsourced. You, the newly cancer stricken. You, the buried- in- alimony. You, the uninsured.
For lawyers like me, it was like winning the lottery. As the effective date of the new law looms, the world starts raining bankruptcy clients. People are lining up at our office door, wanting me to file for them, thinking that the opportunity to file bankruptcy is about to disappear. My staff joked that we should have erected one of those deli counter ticket dispensers.
Back then, bankruptcy law was the evil step child of legal practice. Not many lawyers practiced bankruptcy law. With the passage of the new law, and people filing in droves, it seemed our ship had come in.
Then, a couple of years down the road, the economy collapses with a resounding thud, spewing forth from law schools thousands of unemployable law school graduates. Saddled with massive student loans, they emerge into a world riddled with dead and dying businesses– businesses that cannot pay their law firms—law firms no longer interested in hiring new lawyers.
What would you do if you were one of those graduates? You might ask, as many did : “How can I capitalize on the fall of capitalism?” Suddenly, practicing bankruptcy law seemed like the golden ticket. Overnight, a glut of newly minted lawyers springs forth, and they hang over their doors the flashing neon “Bankruptcies Filed Here Cheap” signs.
Soon there was a bankruptcy lawyer on every corner. Why pay the old, expensive lawyer across the street when this duly licensed newbie will do it for half the price? Never mind that most of the cheapies had never confronted one of the several hundred bad things that can happen in a bankruptcy. Never mind that most of the newfangled had never actually appeared before a bankruptcy judge to defend or explain anything. These were fresh faced rookies who took a couple of continuing education classes, bought themselves some software and…voila…ordained themselves instant “experts”.
Consider this: Do you prefer your airline pilots to be those who landed planes on aircraft carriers, or are you comfortable with a crop duster at the controls of your Airbus? Do you prefer that your surgeon has gray hairs, manifested from years of clamping emergency hemorrhages, or are you cool with the youthful scalpel wielder looking down on you who had to settle for med school in the jungle of Grenada? Admittedly, this analogy may be over-dramatizing. Clearly, the risks associated with hiring a bad bankruptcy lawyer are not life-threatening. But they certainly can be life-altering. If you don’t believe me, stay tuned here.
Coming soon: Julianne shares tales of butchered bankruptcies. For a preview, go to Bankruptcy Insider
Julianne Frank All rights Reserved 2017