QUESTION

Can you hire a CPA and a bankruptcy lawyer at the same time?

Asked on Jul 22nd, 2011 on Bankruptcy - Virginia
More details to this question:
If someone hires a CPA to do work while they are simultaneously consulting a bankruptcy lawyer (i.e. they knew they'd never pay for the work), is that fraud? And if so, what is my recourse? They instructed me to continue working less than 2 weeks before I received a letter stating they had filed for bankruptcy, and they have an outstanding balance of $5,000 with me.
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7 ANSWERS

Debtor's Rights Attorney serving Atlanta, GA at Theodore N. Stapleton, P.C.
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You can object to the dischargeability of the debt on the basis of fraud if you can prove they knew they were going to file when they hired you.
Answered on Jul 25th, 2011 at 12:31 PM

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Family Law Attorney serving Bellevue, WA at Dearbonn Law Offices PLLC
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The amount owed you will be discharged in the bankruptcy. Your options are slim at this time.
Answered on Jul 24th, 2011 at 3:10 PM

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Services performed fewer than 90 days are presumed to be fraudulent and nondischargeable. You must file an adversary proceeding (lawsuit) in the bankruptcy court case to get a determination of its nondischargeability.
Answered on Jul 24th, 2011 at 2:36 PM

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Bankruptcy Attorney serving Hayward, CA at Carballo Law Offices
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It could be fraud but more information would be required to determine if you have reasonable grounds to file a complaint objecting to the dischargeability of the debt owed you for your services. You have a very limited amount of time (generally 60 days after the meeting of creditors) to file such a complaint. You will need to hire a lawyer to represent and it is likely that a $5,000 debt may be too small to warrant the legal fees and litigation costs you will pay without any assurance that you will win and be able to collect anything anyway. You should consult with a bankruptcy attorney immediately. Most consumer bankruptcy attorney would not represent a creditor and most creditor bankruptcy attorneys represent large creditors or collection agenvies so you might find it hard to get a lawyer interested in your case.
Answered on Jul 24th, 2011 at 1:46 PM

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Glen Edward Ashman
It might or might not be. You'd want to meet with a bankruptcy specialist to evaluate pursuing this in bankruptcy court. Bear in mind the retainer would be a few thousand dollars, so it may not be profitable even if it is pursuable.
Answered on Jul 23rd, 2011 at 8:21 AM

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You may have cause to seek an "adversary" action to have the debt determined non-dischargable by the court under these circumstances. You should consult local counsel. .
Answered on Jul 23rd, 2011 at 6:18 AM

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Bankruptcy Attorney serving Herndon, VA at Maureen O'Malley
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First, forgive me for saying that $5,000 is a big fee for 2 weeks of work. It does sound like they knew they'd be filing when they retained you, though. A debt incurred w/in 70-90 days of filing, if for luxury goods and services, is nondischargeable. I'd suggest contacting their lawyer to see if you can work it out. If not, retain counsel for yourself to file a claim of nondischargeability.
Answered on Jul 23rd, 2011 at 6:10 AM

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