| ABI

April 28, 2025

Debtors’ Lawyer Has No 7th Amendment Right to Sue for Post-Petition Fees, Circuit Says

The debtors’ inequitable conduct didn’t relieve counsel of the duty to disclose fees charged for post-petition litigation.

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Opinion Link

View Opinion

https://abiworld.box.com/s/dzimmkwg7nnufpiqrfy4sy7cin013umf

Case Details

Case Citation

In re Aquilino, 24-1781 (3d Cir. April 24, 2025)

Case Name

In re Aquilino

Case Type

Consumer

Court

3rd Circuit

Bankruptcy Tags

Professional Compensation/Fees

Consumer Bankruptcy

Comments

Submitted by Douglas Tabachnik on April 28, 2025

In this case, the lawyers were clearly too inexperienced in bankruptcy practice to have taken on this case, and this case presents such an object lesson; those who might most benefit from the lesson will likely never see this article. Our retainer agreements require debtors to disclose their affairs accurately to counsel and to cooperate in assembling the necessary information. If they violate this duty, all bets are off, and we will move to withdraw. Also, inexperienced lawyers are sometimes unaware that default settings in the software used to prepare petitions can include unintended items in the 2030 Form, such as representations in adversary proceedings. This results in a Form 2030 making unintended representations. The Bankrutpcy Court and Circuit Court got this one right - unfortunately for the lawyers. This may be one of those instances where the savvy miscreant debtors were able to take advantage of insufficiently experienced attorneys to game to system.