Bankruptcy Clinic Saves Client From Precipice of Losing Home

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Last year, Chief Judge A. Jay Cristol of the U.S. Bankruptcy Court for the Southern District of Florida referred a particularly complicated Chapter 13 case to Miami Law’s Bankruptcy Assistance Clinic. The case involved a debtor at the precipice of losing his home, where he lived with his wife and two children, to foreclosure.

The first immediate step in the case was to dismiss the debtor’s previously filed pro se bankruptcy petition in order to re-file a fresh petition. Because the first petition was such a mess and would never have accomplished what he wanted, it was easier to start fresh with a clean slate. The clinic students successfully drafted and argued a motion for the court to voluntarily dismiss the bankruptcy case.

Next, the debtor’s homeowner’s association began foreclosure proceedings. They obtained a judgment against the debtor, and promised the sale date would not take place for 60 days. However, the sale date was set in 30 days, which then necessitated an emergency filing.

The students, along with their mentor Clinic Director Patricia Redmond, met with the debtor multiple times to gather and review documents, prepare the debtor’s new bankruptcy petition and schedules, and determine a strategy for modifying the mortgage on the debtor’s home.

The clinic filed the debtor’s new petition and began to formulate a Chapter 13 plan and push towards Mortgage Modification Mediation with the mortgage lender. During the course of the case, the students had to negotiate with creditors, prepare and argue motions, and work with the Chapter 13 trustee to ensure the plan met local requirements. Ultimately, the Chapter 13 plan was confirmed and the students continue to work towards the debtor’s mortgage modification.

“The Bankruptcy Clinic connects students to reality,” said 3L Amanda Parra, who worked in the clinic during the 2014 to 2015 school year. “It enables students to keep a pulse on what is going on in our community, both professionally through networking opportunities, and through contact with clients who are facing serious financial troubles.”

The Eleanor R. Cristol and Judge A. Jay Cristol Bankruptcy Pro Bono Assistance Clinic at Miami Law offers pro bono legal services to low-income individuals who are dealing with bankruptcy. The Bankruptcy Bar Association of the Southern District of Florida established the clinic and Patricia Redmond, JD ’79, a shareholder at Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A. in Miami, Florida, helms it.

“The clinic provides students unparalleled opportunities to gain real world experience and exposure to the bankruptcy bar,” said Clinic Coordinator Timothy Bow, JD ’13.

3L Parra echoes this, “I've learned that providing counseling extends beyond legal advice and more often than not requires personal advice that helps clients make important life decisions. Sometimes the best legal outcome may not be the best personal outcome for the client.

“For example, in one case I worked hard with my mentor to try to have my client approved for a Mortgage Modification. In the end we all realized, including the client, that although an approval was technically the best ‘legal’ outcome, it also meant the client would be paying for a home that was still underwater and that he would never have any equity in. So as a ‘personal’ counselor, the denial we received was actually the ideal outcome. It forced the client to make the smarter decision.”

Throughout the two-semester clinic, students practice on active cases in federal bankruptcy court. These cases range from Chapter 7s, Chapter 13s, contested matters, and adversary proceedings. In the past, students have filed complaints against student loan lenders to help the debtor discharge student loans. Clients are referred to the clinic by the Put Something Back program at Dade Legal Aid and by sitting judges of the Bankruptcy Court for the Southern District of Florida.

“Clinic students are placed in teams of two, and each team works with a mentor attorney,” said Bow. “The clinic’s roster of mentor attorneys includes some of the most prominent bankruptcy practitioners in South Florida.”

The clinic is working to expand the types of cases it handles and expects to begin assisting small businesses and not-for-profits experiencing creditor problems. These new cases will provide the students with additional skill sets gained through opportunities to problem solve and negotiate with creditors on real world business problems.