Future attorney needs her own advice

[ryan11411]

Until May, I was a "non-traditional" student (ie, older). I graduated law school and took the bar exam this past week, but I will not know for almost 2 months whether I passed (with all the recent stress, I doubt it).

I have a massive amount of credit card debt...MASSIVE. Some of it is from tuition... stupid.... so stupid. I am wondering if anyone here has filed bankruptcy as an attorney, or recent law school graduate, and what the ethical issues may be.

I am in such distress that I feel like I have to file. It's either that and sell my house to pay off some of the credit card debt, but even that isn't near enough. And student loans will be coming soon due as well. And I am broke. I have to decide what bills will get paid this month, what won't, and decide today whether to try to get this house ready to put on the market within the next few weeks. I am terrified.

First, I need to know what the ramifications are for filing now or attempting to wait until after the bar results. Does it matter either way? Will I not be admitted if I passed but file bankruptcy? Will I be disbarred for filing right after being admitted? If I failed the bar, I will have to file anyway. After doing so, should I plan on finding a new career rather than retaking the bar?

I greatly appreciate any advice.

[BKOnce]

Don't think the bar exam or passing results have to do with a "credit check" or credit report of your past finanical/debt history. Maybe when you apply for a financial-related job with any business law firm, maybe that case, ...but law student??.. i doubt it... FBI/Police/CRIMINAL checks maybe.

Why don't you call the bar to ask or Google research more about the credit check requirements on state exams, if any... !?

[ryan11411]

My concern regards the character report/investigation that is done prior to being admitted to the bar (which specifically asks about having ever filed bankruptcy). I guess that answers one of my questions... I am supposed to update any changes in my character report that take place before being admitted to the bar, so I guess that would have to be done upon filing... which could affect their decision whether or not to admit me to the bar. Does anyone know how they look at a bankruptcy in evaluating your character report for the bar?

I fear contacting a lawyer or anyone at the bar association because they may have an ethical obligation to report me seeing as I am possibly about to be admitted to the bar.

[SinkingFast]

Since you're seemingly current on your payments to this point, you really have time to wait out the results of the Bar exam. If you pass, you're free to do what you may need to do with no worries of self reporting.

The BK may come up later as you apply to firms. Just explain you ran out of Student Loan options and charged tuition, books, and fees. Then you didn't get a job soon enough to repay your debts.

[BKOnce]

In that way, I am sure any BK lawyer would give you clear and definitive answer w/o fear of their ethical standards at all. After all, it is your FREE consultation before file & their job functions/duties as giving "unbiased, client-confidentiality advices", isn't it!?

[HHM]

You will not be disbarred for filing BK, but I suppose there is some risk (although I believe it to be minor) that you could be denied admission, or more likely given conditional admission.

For exmaple, the Nevada rules of Professional Conduct give the following requirements for admission

Rule 51. Qualifications of applicants for examination. An applicant for examination for a license to practice as an attorney and counselor at law in this state shall:

1. Have attained the age of majority.

2. Be present or available within the State of Nevada, and remain so until examined as required by Rule 65, so as to permit and facilitate the examination, investigations, interviews and hearings necessary to determine the applicant’s morals, character, qualifications and fitness to practice law.

3. Have received a degree of bachelor of laws, or an equivalent law degree, from a law school approved by the committee on legal education and admissions to the bar of the American Bar Association, and shall present evidence of the same.

4. Demonstrate that the applicant is of good moral character and is willing and able to abide by the high ethical standards required of attorneys and counselors at law.

5. Not have been refused admission to practice law, or have been disbarred from the practice of law, in any state or before any court or governmental agency of the United States on the ground of unfitness of character.

6. Not be subject to any mental or emotional disorder which would render the applicant unfit to practice law.

7. Not be an abuser of alcohol or prescription drugs, or a user of illegal drugs.

8. Demonstrate financial responsibility.

9. Be in full compliance with any court order, including without limitation, spousal or child support orders.

Note #8, I suppose an Bar examiner could say you don't show financial responsibility with a recent BK...but I don't think a BK, alone, would be grounds for outright denial of admission to the Bar.

If you really want to find out, break out the rules of professional responsibility for the State you took the bar exam in and see if they mention anything about BK (I can almost guarantee it wont).

Also, I wouldn't worry about attorney's reporting you (you are over thinking this...a by product of law school, vs real life law practice). First off, you are not an attorney, and an attorney's duty to report only extends to other members of the Bar. Also, it is rare that attorney's ever report other attorneys.

Although becoming an attorney is important, you have taken the Bar exam, so your admission to the Bar is out of your hands at this point, and you need to focus on your immediate financial concerns.

[SinkingFast]

Also, it is rare that attorney's ever report other attorneys.

We know of a local example of that here.

Prior to retaining the attny that filed our BK, we retained another attny to handle a DIL Offer on our house.

We were behind in our payments, got a VERY threatening letter indicating Foreclosure was imminent. We'd seen this attny. Thought he knew his stuff. Decided to have him negotiate a DIL Offer for us.

Called him up. He said, "Sure! Bring me $350 and I'll take care of that for you."

He never did a thing. His assistant called our Realtor. Had our Realtor do a bunch of work and fax a bunch of stuff. And that was it. No negotiating with our Lender. Nothing.

So we moved on. Found the attny we decided to hire.

In chatting with the paralegal once our case was nearly done, I mentioned the other attny and what a louse he was. The paralegal told me our attny had 5,........ yes that's FIVE,......... other clients since us that had retained and paid the other attny money too. And the other BK attny did nothing for them either. One poor couple had in fact paid that other attny $1000.

When a BK Petition is filed, the attny lists all fees paid to all attnys. So the Trustees here, all attnys themselves, know this guy is gouging people. Yet nothing is being done about him. And he continues to rake in extra dough out of BK people for not doing a thing.

[CityGirl]

can I ask how much you owe? My brother in law is an attorney. I can ask him....

[BurgerKingVII]

My concern regards the character report/investigation that is done prior to being admitted to the bar (which specifically asks about having ever filed bankruptcy). I guess that answers one of my questions... I am supposed to update any changes in my character report that take place before being admitted to the bar, so I guess that would have to be done upon filing... which could affect their decision whether or not to admit me to the bar. Does anyone know how they look at a bankruptcy in evaluating your character report for the bar?

A few years ago, the National Conference of Bar Examiners published some articles on this very subject, with discussion of relevant case law:

http://www.ncbex.org/uploads/user_docrepos/720403_jackson.pdf

http://www.ncbex.org/uploads/user_docrepos/720403_long.pdf

Filing bankruptcy won't, by itself, prevent bar admission. The cases where people have been denied admission after filing BK seem to involve stuff like lying on one's BK petition, trying to discharge debts incurred for luxury purchases on the eve of BK, or filing for BK when the debtor clearly had other options. And those are things that are likely to cause trouble for anyone who files BK.

In short, I wouldn't worry about it too much. But since you do have a duty to update your bar application until you're admitted, it might make things easier to postpone your filing until after you're sworn in, if that's possible.

[BurgerKingVII]

8. Demonstrate financial responsibility.

I'd like to think that filing bankruptcy, if appropriate under the circumstances, is a act of financial responsibility. You're actively dealing with the problem according to the procedure specified by law, which seems more responsible than, say, doing nothing.

[jonisk]

Ryan - it sounds like you are in CA (character & fitness after bar exam). You should wait, IMO, until you pass and are admitted. You have a duty to update your character & fitness application. Unless the situation becomes so untenable that you can no longer manage it, stick with it. Firms won't really do the kind of background checks that show you have a bankruptcy, but certainly they can find out later.

You won't be disbarred, and you don't have to find a new career. Lots and lots of people don't pass the bar.

You never know, you could find the process so interesting that you pursue bankruptcy law!