You are here

Chambers' Bulletins

Judges' Corner
Wed, 3/07/2007 - 4:00 am


The following proposals have been approved by the Judges of the Bankruptcy Court for the District of South Carolina, after approval of the Court's Advisory Committee and the Chapter 13 Trustees in the District.

Attorneys' Fees for Debtor's Attorneys in Chapter 13 Cases:

Statistics for 2006 show a 61% decrease in the filing of new bankruptcy cases in our District. A closer examination of this issue reveals a number of areas in South Carolina where the few attorneys who formerly filed consumer debtor cases appear to have dropped out of the practice due to lack of knowledge or fear of the Bankruptcy Reform Act. This has raised concerns regarding the availability of bankruptcy services in those areas. In addition, it is apparent that the new requirements of the Reform Act have resulted in a uniform increase in attorneys' fees for consumer cases, which has effectively priced some debtors out of representation. Due to the increased costs of representation, more debtors are filing pro se or delaying their filing while they raise money for retainer fees. The lack of representation and delay in filing often causes debtors' cases to fail. At a recent meeting, the Judges agreed in principle with the idea of improving the timing of payments to debtors' counsel in Chapter 13 cases as an encouragement to keep qualified counsel in this area of practice and to promote service in more borderline or pro se cases. A limited comparison of practices in other Districts demonstrates that South Carolina is conservative in its approach on this subject.

The Judges would appreciate the comments of the members of the bankruptcy bar on the following proposals for changes in this District:

1. Elimination of Percentage Cap on Attorneys' Fees:

Presently, all secured claims are paid first (including adequate protection, which is often the payment itself) with the only carve out being the attorneys' fees capped at 25% and domestic support claims. The elimination of the cap would allow debtors' attorneys to receive more of their fees earlier on in the case, to the extent the payment is not fully consumed by the required payments to the secured creditors. The improvement in the timing of payments to debtors' attorneys encourages better representation and creates a better process for everyone, including creditors. The following changes to Paragraph 3 of the form Chapter 13 plan are suggested (leaving the rest of the Chapter 13 plan as is):

3. Subject to review and objection, a proof of claim for the attorney's fees of the debtor(s) in the amount of $_______ will be filed, and may be amended from time to time, and shall be paid with all funds remaining each month after payment to secured and domestic support creditors as set forth below.

2. Pro Se Cases :

To further encourage attorneys to take over pro se cases, the following language could be added to the plan in applicable cases (to follow the above paragraph):

"In instances where counsel assumes representation in pro se cases and a plan is confirmed, a separate order that allows the payment of a portion of the attorney's fees ahead of payments to other creditors may be entered by the Court without further notice."

3. Payments Upon Conversion or Dismissal Before Confirmation:

Amend Local Rule 1019-1 to include a directive that upon conversion or dismissal of the case, and subject to objection by the Trustee or other party, the Trustee is authorized to pay to the debtor's attorney, rather than refunding to the debtor, the lesser of (1) the amount of the attorneys' remaining unpaid filed claim; (2) $500 or (3) the remaining balance on hand after adequate protection payments and trustee fees.

Any comments should be forwarded to waites_chambers@scb.uscourts.gov on or before March 27, 2007.

Judges' Corner
Thu, 3/01/2007 - 4:00 am


Judges Waites and Duncan and the staff of the US Bankruptcy Court wish to congratulate Judge Beth Burris on the one year anniversary of her appointment to the bankruptcy bench in South Carolina. We all wish her continued happiness in her service.

New Case Assignment
Tue, 2/06/2007 - 4:00 am


Effective February 1, 2007, Judge Burris will be assigned one-half of the newly filed Chapter 13 cases in the Columbia division in which Keenan Stephenson serves as Trustee.

Wireless Access
Tue, 2/06/2007 - 4:00 am


In addition to wireless capabilities in Columbia and Charleston, the Judges are please to announce that wireless access is now available in Spartanburg.


Further, attorneys registered to access the Court's wireless network and approved to bring laptop computers into the courthouse for use in making presentations to the Court are also welcome to use the Court's facilities in Columbia on days when 341 meetings are conducted in the Strom Thurmond Federal Building. The Judges of this Court trust that this will be of assistance to those of you who travel some distance to attend 341 meetings and could use the opportunity to work or communicate with your office between meetings of creditors. Wireless service is also available in Spartanburg and Charleston where the Courts are also used for 341 meetings.


A wireless signal is available on the 2nd and 3rd floors of the courthouse in Columbia and will be available in the basement canteen area in the near future. Please be considerate of those in the adjacent chambers and office space while using wireless access in the second and third floor conference rooms and in the canteen area.

New Policy on Returned Mail and Changes of Attorney Addresses
Tue, 2/06/2007 - 4:00 am

See Operating Order 07-03.

After consultation with the Court's Advisory Committee, the Judges have approved a new policy which allows the Clerk to delete incorrect or incomplete addresses from the mailing matrix upon the return of mail for the failure of service or to change the address to a corrected or forwarding address if provided by the U.S. Postal Service. Returned mail will be noted on the case docket, in order to advise (by NEF) debtor's counsel, trustees and other parties of the deletion or change and indicate the opportunity to provide a corrected or complete address.

In the instance of an attorney's change of address, the notifying attorney should provide a specific list of cases in which the address change will be noted, otherwise it will be changed in all pending and closed cases in which the attorney is associated.

Mediation Program
Tue, 2/06/2007 - 4:00 am

The Court maintains a list of experienced bankruptcy counsel who wish to be considered as mediators in bankruptcy related litigation. These counsel agree to be available on short notice and often agree to a reduction in their usual hourly rate. Any counsel who wish to be listed should contact waites_chambers@scb.uscourts.gov. A description of the mediation program appears under the Chambers Guidelines & Information section of the Court's Web Page.

Happy Holidays!
Thu, 12/21/2006 - 4:00 am

The Judges and staff of the U.S. Bankruptcy Court wish everyone the happiest of holidays and a happy new year.

Various Matters of Interest to the Bar:
Thu, 12/07/2006 - 4:00 am

The Judges would like to alert the bar to several matters to assist in the administration of cases.


1. The United States Trustee has reported recently that several bankruptcy referrals have been prosecuted and resulted in indictments in this District:

On October 4, 2006, a debtor was indicted for allegedly using a false Social Security number to file bankruptcy.

On October 10, 2006, a debtor was indicted for allegedly keeping rent proceeds he collected from property of the estate while he was in bankruptcy. The rent proceeds were also property of the estate and should have been turned over to the bankruptcy trustee.

On October 10, 2006, an individual was indicted for forging a bankruptcy judge’s signature to a document in order to qualify for a loan on a used car.

On November 28, 2006, a debtor was indicted for concealing bank accounts and an insurance claim and for false statements he made at his meeting of creditors.

A bankruptcy judge recently referred to the U.S. Attorney testimony provided by a debtor in a hearing that he had failed to report income from his rental properties in his Tax Returns for the applicable years.


2. The Judges have agreed that whenever a motion for relief from the automatic stay represents that the movant agrees to waive certain claims or expenses provided under Sections 503(b) and 507 and to return to the estate any proceeds in excess of the liquidation of its secured claims, that such provisions should also be included in the proposed order/settlement order submitted to the Court if applicable to that order. The case trustees have agreed to monitor proposed orders for compliance with this requirement.


3. According to the recent ruling by the United States District Court in In re Singleton, C/A No: 02.06-CV-1666-PMD, a party seeking to have the Court reconsider dismissal in a case which has also been closed should file a motion to reconsider dismissal that meets the requirements of FRCP 60 and a motion to reopen. Merely requesting the reopening of the case may not provide the relief the movant seeks. Please consult the Court docket whenever taking such action to determine if the case has not only been dismissed, but also closed by the Court.


4. The official form required for filing in connection with a debtors completion of a financial education course before discharge has changed effective October 1, 2006. Debtors counsel should ensure the official form is executed by the debtor and completed (including the number of the educators certificate) and filed with a copy of the certificate. (Again this is a different requirement and form than the credit counseling certificate required at the beginning of a case.) The new official form can be found on the Court's Web Page under Forms.

New Exemption Order
Wed, 12/06/2006 - 4:00 am

On December 5 Judge Burris issued an opinion on the applicability of the South Carolina Home Security Act (the new homestead exemption) in bankruptcy cases. This decision will likely affect consumer debtors throughout the state. The opinion was issued as a joint opinion in four cases and all three judges concur in the result. The lead case number is 06-02413 and the order can be viewed therein via CMECF and will be available on the court's website soon.

Public Service Initiatives
Fri, 12/01/2006 - 4:00 am

On behalf of the Judges of this Court, Chief Judge Waites would like to announce two public service initiatives to be sponsored by the U.S. Bankruptcy Court and invite participation by the bar.


The South Carolina Supreme Court has appointed a Task Force on Access to Justice with the goal being to improve the delivery of Legal Services to the state’s indigent population. Since many in this population face issues relating to debtor/creditor relations and bankruptcy, Judge Waites has been asked to serve on the Task Force. In order to consider factors which may improve the availability of legal services in the bankruptcy area, the Judges will invite bankruptcy practitioners to participate in two meetings to discuss issues related to the availability of legal services. Topics include information provided by the Court to pro se parties, educational programs on the Reform Act and bankruptcy, the unbundling of legal services in certain situations, locations of court hearings and consideration of the structure of court divisions, courtroom assistance for pro se parties, and mediation procedures involving pro se parties, among others.


The Credit Abuse Resistance Education (CARE) Program is a national initiative in which many bankruptcy courts coordinate the availability of judges, trustees and experienced attorneys or staff to speak to high school and college students regarding the use of consumer credit and the consequences of credit abuse. There is no required format or agenda for such presentations which are coordinated by the Court, but a training program and materials will be made available. Judge Waites has previously received requests from schools in various parts of the state, so assistance from the bar statewide would be appreciated. The CARE program is already available in many other districts and has been proven to be a well received and beneficial public service.


Trustees, Counsel or experienced bankruptcy staff willing to participate on these initiatives should advise Judge Waites on or before December 12, 2006 at waites_chambers@scb.uscourts.gov.

Pages

Subscribe to Chambers' Bulletins