Recommended books / links for Chapter 7 Pro Se Filers

[bornfree2]

Are you considering filing a Chapter 7 by yourself? Arm yourself with knowledge by digging deep into law books. If you decide to use a bankruptcy attorney (recommended!!), you will have a jump start on the theory and practice of BK 7 filing, litigation, etc

Here are some useful books and online resources. They are bankruptcy in general and some state specific. I try to study books that play all sides (debtor, creditor, trustee) so I can get basic and advanced knowledge for different eventualities. Obviously BK is a massive topic, and most of these books are heavy reading, but standing on shoulders of giants one can see further...

You can find them at a law library or perhaps online:

I will update this thread as I come across more resources. Feel free to contribute! Whats on your reading lists?

Beginner:

• Nolo's "How to File Chapter 7 Bankruptcy
• https://www.legalconsumer.com/bankruptcy/ (very useful!)
• Consumer Bankruptcy Law and Practice (volume 1 and 2) by National Consumer Law Center
• Bankruptcy in a Nutshell - David G Epstein
• Personal Bankruptcy Answer Book - William C Hillman / Margaret M. Crouch

Intermediate:

• California Practice Guide Bankruptcy - Rutter Group
• Bankruptcy Courts and Procedures
• Basic Bankruptcy Law for Paralegals - Wolters Kluwer
• Bankruptcy Deadline Checklist - Norman L Pernick

Advanced:

• Bankruptcy Litigation Manual - Micheal L Cook
• Bankruptcy Litigation and Practice - Thomas J. Salerno + others
• Representing Debtors in Bankruptcy - Joseph J Norton + others
• Automatic Stay Litigation in Bankruptcy - Mark A. Shaiken + others
• Bankruptcy Litigation Manual - What Civil Litigators Need To Know - R. Scott Williams , others
• The Bankruptcy Claims Handbook - Business Bankruptcy Commitee

[bornfree2]

This was a fun one to skim this weekend

The Early History of English Bankruptcy 1919

ETYMOLOGY oF "BANKRUPr."

One writer has said: "Perhaps it can in no case be less necessary to investigate the etymology of a word, because the whole system of the bankrupt law is founded upon positive statute.' For the purposes of the practitioner this is no doubt true, but for the historian, the etymology and derivation of the word "bankrupt" must be of some value.

Lord Coke says that "we have fetched as well the name as the wickedness of bankrupts from foreign. nations; for banque in the French is inensa, and a banquer or exchanger is mensarius, and route is a sign or mark; as we say, a cart roit is the sign or mark where the cart bath gone; metaphoricalli, it is taken from him that bath wasted his estate and removed his banque, so as there is left but a mention thereof. Some say it should be derived from banqzw and rompue, as he that bath broken his banque or state."' 4 Mr. Justice Heath saysr that the word comes from the Italian banco rotto, but it appears rather to be immediately formed from the Latin bancus ruptus.

It is interesting to find that the first time the word is used in English legislation, it is not applied to the agent or person, but to the act or thing, as in the title to the Statute 34 & 35 Henry VIII: "An act against such persons as do make bankrupt." It is of further interest to note that, in the pleadings and the commission in bankruptcy, "decoctor" was the word used in bankruptcy proceedings, until the statute of 4 George II, c. 26 (1730).6 As this word' would naturally be construed spendthrift, and as every spendthrift- is not a bankrupt, there was always added after it the words, "Anglicc a bankrupt."

[bornfree2]

The Black Book ... the secrets Creditors dont want you to know

I had nightmares reading through Bankruptcy Litigation Manual - (Micheal L. Cook Editor). The power of Creditors to examine the debtor - and anyone they want to rope in - is unbelievably unrestrained.


My favorite was Chapter 4 Discovery:

No longer can the time-honored cry of "fishing expedition" serve to preclude a party from inquiring into the facts underlying his opponent's case. Hickman v Taylor, 329 U.S 495, 507 (1947)

4.01 - Use of the Statement of Financial Affairs and Schedules as a Discovery Device
4.02 - Use of the First Meeting of Creditors as a Discovery Device
4.03 - Turnover of Property to the Estate
4.04 - Bankruptcy Rule 2004 Examination

The entire book is like a Creditor's battle plan. Full of strategies, motions, case law, etc that they could potentially use to protect their interests.

Well worth the time to skim/study to understand 'the other dark side' and the powerful tools they have to dismember the debtor.

Publisher's webpage provides more context on its content.

[bornfree2]

Some more resources for early bird study.

• Boston College Law Library - BK Law Research - a great bibliography and resources.
• Bankruptcy Basics: A Primer - (Kevin M. Lewis, Legislative Attorney) Congressional Research Service

[bornfree2]

Fantastic articles on how exemptions work and the case law history.

• Property Exemptions - National Bankruptcy review commission
• Bankruptcy Exemptions – Can a Court Deny Exemptions After Law v. Siegel?
• Exemption Strategies After Law v. Siegel
• Proper Valuation of Property and Exemptions in Consumer Case
• American Bankruptcy Institute search for 'Exemption' - journal articles can be found at law library

Paywall articles can be found at law libraries. Use text to speech to have it read to you and/or save as mp3.

Its critical for the Pro Se to understand everything about exemptions.

[bornfree2]

Deadlines and triggering events

Norton Bankruptcy Law and Practice - Norton Bankruptcy rules

This fat 1500+ page book contains all the Federal Rules of Bankruptcy Procedure, Official Forms, Federal Rules of Evidence, Timeline charts, Appendices, and topical index. You really get an idea just how large the FRBP when printed out - huge! And this doesnt include the US Code text which would probably add another 700 pages!

Pro Se tip:

1) If you get your hands on a copy, thumb to pages 1416-1431 for the Timeline Charts. These are very instructive for the Pro Se because they point out important deadlines and triggering events found in the Rules and in the Code. For example, the Chapter 7 timeline (p. 1416-1419) shows what needs to be filed before the 341, after the 341, and various deadlines creditors have. (source: 2021-2022 Edition)

You can find similar information at https://www.bankruptcyvisuals.com/

2) The index is topical and references the code and rules. So for example if I look up Debtors, i find 'insanity of debtor, effect", and it points to rule 1016 .

This rule says "Death or incompetency of the debtor shall not abate a liquidation case under chapter 7 of the Code. In such event the estate shall be administered and the case concluded in the same manner, so far as possible, as though the death or incompetency had not occurred."

So... if you go insane or die while trying to Pro Se your way to bankruptcy, THE SHOW MUST GO ON!

[bornfree2]

CALI - Free legal books and short podcasts

Recently discovered CALI The Center for Computer-Assisted Legal instruction. A good intro is this video by its executive director.

They provide many free legal books. In particular check out Bankruptcy Law and Practice. Additionally the bankruptcy subject outline provides a high level view.

Also worth checking out is their short podcasts on many legal topics. An index is here .This one is about the general bankruptcy concepts and automatic stay.

Finally, i found CALI from this great page from the brooklyn law school library

[bornfree2]

From the United States District Court Northern District of California,

• Representing Yourself In Federal Court: A Handbook for Pro Se Litigants
• https://www.cand.uscourts.gov/pro-se...lates-packets/

Useful but keep in mind this is not bankruptcy court specific.

[bornfree2]

One Size Fits None: An Overdue Reform for Chapter 7 Trustees

Article talking about the poor-overworked-undercompensated-boo-hoo trustees in C7 cases

This entangled trustee-compensation scheme yields serious, unwelcome consequences. Most significantly, it makes Chapter 7 consumer cases extremely undesirable to trustees.10 In turn, this creates the risk of inequitable and inefficient system-wide outcomes. To cut costs, trustees may underinvestigate consumer cases, resulting in an unjust windfall for some debtors. Alternatively, trustees may overzealously investigate every consumer case they get to make those cases worth their while, subjecting those debtors to excessive takings.11 The current scheme harms consumers seeking Chapter 7 protections even when there is no abnormal distortion of the ratio of business to consumer cases—in other words, even when times are normal.

[justbroke]

Article talking about the poor-overworked-undercompensated-boo-hoo trustees in C7 cases

Do you understand how the Chapter 7 Panel Trustee "pool" works and how they only get about $70 a case? Most of the Chapter 7 Panel Trustees are actually practicing bankruptcy attorneys, where they make most of their income. Once in a while you might get a good Chapter 7 case where there is a distribution and you didn't spend (waste) $500-1,000 investigating a case that only gets you $70.

They are right that the system of the panel trustee isn't exactly the best system. It has caused strange things in Florida's panel trustee system. They came up with the carve-out when the debtor wants to surrender the home.

The Chapter 13 Standing Trustee, however, is usually the only Chapter 13 Trustee or one of two in an entire district. The Standing Trustee has staff and operate a serious accounting office and can be running 2,000+ cases each year. The Chapter 13 Trustee is actually bound by statute to not make more (personally) than a Level V Executive in the federal government (don't quote me, I didn't go look this up again). In other words, they max out... but they spend a lot running their office. Oftentimes, these Chapter 13 Standing Trustees will have as many as 3-4 staff attorneys alone, not to mention a decent amount of office staff.

Maybe making the Chapter 7 system more like the Standing Trustee may work, but it may also work against how it was intended for the Chapter 7 system to work.

[bornfree2]

Do you understand how the Chapter 7 Panel Trustee "pool" works and how they only get about $70 a case? Most of the Chapter 7 Panel Trustees are actually practicing bankruptcy attorneys, where they make most of their income. Once in a while you might get a good Chapter 7 case where there is a distribution and you didn't spend (waste) $500-1,000 investigating a case that only gets you $70.

$70 a case but once in a while they get the big fish? Let's investigate this idea in light of available actual data.

Rule 2013. Public Record of Compensation Awarded to Trustees, Examiners, and Professionals - "(a) Record To Be Kept. The clerk shall maintain a public record listing fees awarded by the court (1) to trustees and attorneys, accountants, appraisers, auctioneers and other professionals employed by trustees, and (2) to examiners. The record shall include the name and docket number of the case, the name of the individual or firm receiving the fee and the amount of the fee awarded. "

Now lets look at the public record to find exactly what they are being paid.

Here is a local court page on this

Here is 2021. On the pdf, just search for '(TR)' . to pinpoint how much a trustee is paid over that year.

examples:

Amy Goldman (TR) Sub-total: $164,036.58
Arturo Cisneros (TR) Sub-total: $317,520.71
Brad Krasnoff (TR) Sub-total: $217,803.15
Caroline Djang (TR) Sub-total: $265,900.63

Now, it can argued these figure are skewed because they coupled them with the professionals they employ.

They did not group it like this in the 2017 report

https://www.cacb.uscourts.gov/sites/...2017_Payee.pdf

Here you can search for '(TR'). and you will find how much each trustee individually made. Again, way north of those darn time wasting '$70' a case.

There should be no commission structure whatsoever. It only produces the undesirable effects that the article describes. Are tax audits done this way too? The more the auditor goes fishing the more they can take home for themselves?

Why stop at the trustee? How about the judge and the court clerks all motivated to find holes in the debtor so they can take a cut off the bankrupt debtor?

I can only guess this practice/rule was lobbied by the banks at one point in time.

So yeah, boo-hoo. its good to be the trustee.

edit: the advisory committee notes reflect the same sentiment

A basic purpose of the rule [Rule 2013] is to prevent what Congress has defined as “cronyism.” Appointment or employment, whether in a chapter 7 or 11 case, should not center among a small select group of individuals unless the circumstances are such that it would be warranted. The public record of appointments to be kept by the clerk will provide a means for monitoring the appointment process....

These findings included the observations that there were frequent appointments of the same person, contacts developed between the bankruptcy bar and the courts, and an unusually close relationship between the bar and the judges developed over the years. A major purpose of the new statute is to dilute these practices and instill greater public confidence in the system.

[justbroke]

Do you know you just listed people that do a lot of Chapter 11 cases? These attorneys work for major firms that deal with business and personal Chapter 11s. A Chapter 11 debtor, as an individual, is a much different person than the average Chapter 7 person.

Even if a Chapter 7 Panel Trustee made $170K a year... how much billing did they generate (how many hours did they work).

The reason this system works like this is because it would be a burden on the bankruptcy system when it comes to Chapter 7s to hire government attorneys (think Assistant US Attorney) to do this job. As I wrote, perhaps the Chapter 7 Panel Trustee system is not the best and maybe could be fashioned like the Chapter 13 Standing Trustee system, but the bankruptcy system would grind to a halt.

(Judges trying to find holes in a debtor's case? I have never ever heard such a thing at all. Bankruptcy is a very "technical" procedure and the procedure must be followed. While the Supreme Court has opined that bankruptcy courts must divine (interpret) many of the filings of a Pro Se debtor, the Supreme Court also said that procedure (process, technical details) is still required. I for one, as a Pro Se, and glad for that!)

It's not worth the discussion because it's not as rosy as a few attorneys doing well (and they probably make most money on Chapter 11 cases). Just in CA Central, in 2021, there were 20,000 Chapter 7 cases. As i wrote, the $70 is for no-asset cases. If 96% of the 20,000 are no Asset Cases, that's still over $1,300,000 in fees across the attorneys.

The other 4%, that's the money. Those are the cases where a Trustee will make a commission on a sliding scale (commission goes down as amount increases). Some firms make more, some of the people you listed are actually managing and name partners at large firms so they'll get the bigger cases.

I'm not saying the system is perfect. The system collected $8.9B in assets in 2020 across 1,350,000 cases. That's about $6,592.60 per case and we know that 95-96% of cases are no asset. The 4% of cases yield $164,814 each on average and the Trustee makes about $11,814 on that amount (sliding scale downward). (Source: U.S. Trustee Program Annual Report Fiscal Year 2020)

[bornfree2]

As i pointed out the way the reports are generated has changed. The 2017 report provides the direct evidence to my point. Search for ('TR') and you can scroll through all chapter 7 trustee accounts. They all make bank. (if they want more money they can work on other areas of law - the public interest in justice overrides what should 'halts a bk system' because of money hungry players)

And yes judges are biased against debtors. Just visit the state court house and see the slaughterhouse of unsubstantiated claims by illegitimate debt collectors against the public.

Anyways id like to keep this thread focused on books/links to help the Pro Se so i wont belabor the point. Sufficient to say I think a commission based system assures abuse, incompetency, and invites corruption. People in the legal system should be motivated by upholding and preserving the constitution not their bank accounts. We can agree to disagree as per usual ;)

[bornfree2]

Closest thing to a Pro Se Bankruptcy manual ive found

NCLC's Pro Bono Bankruptcy Training Program Material

The training material on this site is intended to help pro bono programs, legal services programs, local bar associations, and other organizations provide high-quality trainings for volunteer attorneys on representing consumers in bankruptcy cases. This material is provided free of charge, subject to acceptance of the terms of use. We request that users review the terms of use before reviewing and downloading the information and material on this site. The training material may be used only for educational purposes.

I also highly recommend getting your hands on https://library.nclc.org/Bankr/. You can find it a good local law library for free.

[bornfree2]

Professor Hayes videos on bankruptcy

Very useful videos with general info about bankruptcy, chapter 7, chapter 13, and exemptions from John Hayes Bankruptcy lawyer and professor.