Today, we welcome Frank P. Pipitone. Frank is a consumer defense attorney located in Garden City, New York. His practice is focused on consumer credit issues including debt settlement, foreclosure solutions and personal bankruptcy. He is a firm believer in the rehabilitative power of bankruptcy.
RANDOM MUSINGS FROM THE “341”
By Frank P. Pipitone
No, “341” does not refer to the discontinued Oakland area code. “341” refers to the 341 Meeting of Creditors, named after the applicable section in the Bankruptcy Code.
For the purposes of this article and in the interest of speaking like a normal person, we will simply refer to this as the “Bankruptcy Hearing.”
This hearing is typically held within one month of the filing of the bankruptcy petition. A normal bankruptcy hearing involves the court appointed trustee examining the debtor.
The purpose of the examination is to determine if there are non-exempt assets available to pay creditors, if the information in the bankruptcy petition is accurate and/or to discover possible fraudulent activity.
For lawyers who have attended hundreds of these hearings, they become almost mundane. For the debtor, they can be intimidating and stressful. That is why I love seeing the relief on my clients’ faces upon completion of the hearing.
Here are some recent client comments I have taken in after attending bankruptcy hearings.
This is literally a sigh of relief. Of all the hearings I have attended, I cannot remember one client who did not express some level of relief that it was over.
Yes, that’s it! As lawyers, we understand how anticlimactic the bankruptcy hearing can be.
Debtors, on the other hand, view the hearing as bankruptcy judgment day. They expect to be interrogated and they fear having their financial lives turned upside down.
I find it quite endearing when my clients are able to laugh and joke about how simple and uneventful their hearing was.
“That was quick!”
While the bankruptcy trustee is required to ask certain questions, each trustee has their own style and cadence.
Some are slow and methodical in the questioning while others are quick and to the point. With that said, it is very rare that a bankruptcy hearing will last more than five minutes.
“At least I’m not the only one.”
Bankruptcy hearings will typically take place in one or two dedicated rooms at the court.
It is not uncommon to see 25, 50 or even 100 people coming and going during a typical hearing day. I have seen this put my clients at ease.
Bankruptcy filers are usually good, hardworking people who fell on bad times. Knowing they are not the only ones provides a sense of normalcy and validation that is sometimes needed.
“That wasn’t like a real court room.”
Many people expect their bankruptcy hearing to be held in a real court room in front of a judge.
Hearings are typically held in designated rooms with no judge, bailiff or court reporter.
While bankruptcy hearings are extremely important for the outcome of the case, clients always remark on how “informal” the process is.
“What happens next?”
This is an obvious question. Most bankruptcy hearings will end with the “closing” of the case. Essentially, the case is done, but creditors do have sixty days to file objections.
Assuming there are no valid objections raised, the debts will typically be discharged sixty days after the hearing.
A Financial Management Course must be completed prior to the discharge.
On rare occasions, the trustee will adjourn the hearing and request additional documentation or information to help resolve the case.
So, these are just a few recent (and quite common) comments I have gotten from clients subsequent to their hearings.
I always tell my clients to relax. The bankruptcy hearing is just one small part of a larger process. Unfortunately, this is usually realized after the hearing is completed.
Frank P. Pipitone is a consumer defense lawyer located in Garden City, New York.