There are certain principles that can apply across an array of areas of the law. In many settings, it is good advice to “get it in writing.” The ability (or lack thereof) to produce a written document that supports your assertions regarding the terms of a statement or agreement can be essential to a successful outcome. This is also true in some bankruptcy situations. According to a recent U.S. Supreme Court decision, a debtor was able to overcome a claim of non-dischargeability and discharge a debt because the creditor lacked a written document to support its claim that the debtor engaged in falsehoods regarding his financial condition. As with any bankruptcy issue, it is worthwhile to ensure that you have knowledgeable South Florida bankruptcy counsel working for you.
The origins of the bankruptcy case began with a client who hired a law firm in Atlanta to represent him in a business litigation matter. Eventually, the client fell behind on legal bills to the sum of nearly $60,000. The firm threatened to cease representing the client, but he told them he was expecting a tax refund of $100,000. The firm relented. The client’s refund was actually around $60,000, and he spent the whole amount of his business, paying none of it to the law firm. In a later meeting, he told the firm that he had not yet received the refund. Based on that statement, the firm went forward, litigating the case to completion.
The law firm eventually had to sue for the unpaid fees, and a Georgia court awarded it $104,000. Along the way, the client filed for bankruptcy. The law firm filed an action in the bankruptcy, arguing that the $104,000 debt the client owed was not dischargeable.