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Attorney liability for bad advice

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    Question Attorney liability for bad advice

    Are bankruptcy attorneys liable for advice that leads the debtor into trouble, such as incorrect pre-BK planning?

    If the trustee asks the debtor why they made a questionable transfer, and the debtor says they were instructed to do so by their attorney, what happens?

    What if the petition is dismissed as a result?

    Unless it's unethical or some sort of Rule 11 (Bankruptcy Rule 9011) violation, then it's just advice of a professional. Unless you can prove that they acted in bad faith or outside the law, it's hard to find them liable.

    Think about all the attorneys that tell people to sue someone, and the lawsuit is lost. The attorney is still paid. Very few "complaints" are lodged with the bar (association) regarding their conduct... otherwise no one would ever follow an attorney's advice; especially where it puts them in a worst place.

    I would say that attorney advice is, at times, like medical advice. When it seems to good to be true, seek a second opinion.
    Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
    Status: (Auto) Discharged and Closed! 5/10
    Visit My BKForum Blog: justbroke's Blog

    Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.


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