Life After Foreclosure

Без названияWhat is a Foreclosure?

Foreclosure is a legal process in which a lender attempts to recover the balance of loan from a borrower, who has stopped making payments to the lender.

The foreclosure process as applied to residential mortgage loans is a bank or other secured creditors selling or repossessing a parcel of real property after the owner has failed to comply with an agreement between the lender and borrower called a “mortgage” or “deed of trust”.

Continue reading

So Who Gets the Profits From “Unfinished Business” in a Major Law Firm Bankruptcy Case?

So who is entitled to the profits for “unfinished business” in the bankruptcy of a major law firm?  That is the $64,000 question that was recently answered by a New York judge in the bankruptcy case of the firm of Dewey & LeBoeuf LLP.

The issue at stake is when partners leaving a defunct law firm bring unresolved cases with them to their new law firm, which law firm is entitled to the profits – the old defunct firm or the new one?  The trustee for former New York firm Coudert Brothers LLP had sued 10 firms that hired former Coudert partners in an effort to recover those profits. While no dollar amount was specified, as the firms did not provide documents outlining how much money they made, a federal judge in Manhattan ruled on Thursday that that the proceeds from those cases did indeed belong to Coudert Brothers.

District Judge Colleen McMahon made her decision on the following basis:

“Because the Client Matters belonged to Coudert on the Dissolution Date, and because the Coudert Partnership calls for the application of the Partnership Law to determine the post-dissolution rights of the partners, the Former Coudert Partners have a duty to account for profits they earned completing the Client Matters at the Firms,”

Judge McMahon’s decision sets a major precedent (particularly in New York) as it reaffirms a 1984 California case known as Jewel v. Boxer that had been adopted in several other states.

For additional information, please see the Wall Street Journal Law Blog article written by Jennifer Smith entitled: Profits from Unfinished Business Belong to Dissolved Law Firm, NY Judge Says

Can Someone with Asperger’s Be Forgiven Debt Due to Their Disease?

 

According to an article in The National Law Journal published on May 21, 2012, Asperger Syndrome prompts court to forgive former law student’s debt, a United States Bankruptcy Court in Maryland dismissed over $335,000 of Carol Todd’s student loan debt due to her Asperger Syndrome.  Under federal bankruptcy law, student loans must be paid unless the debtor’s circumstances meet the rigorous “undue burden” standard.

In this case, the judge found that Ms. Todd, age 63, who attended law school in 1992, but did not finish, obtained a master’s degree from Towson University and a Ph.D. from an unaccredited online school in 2007, could not expect to overcome the demands of her disorder and discharged the debt.

Student loans are rarely discharged in bankruptcy, albeit this is a very unusual case.  It may be that in the future we may see that student loan applications contain questions about mental health illness, limiting the ability of a student with a past history of illness to receive educational loans.