Eliminating divorce attorney fees in bankruptcy

In chapter 7 bankruptcy general unsecured debt is included in the discharge order.  In practical terms, this means that credit card debt, medical bills, and payday loans are eliminated after the order for discharge is entered by the Bankruptcy Court.  However, what many clients don't know is that past attorney fees may be included in the discharge order and thereby eliminated in bankruptcy.

Divorce Attorney Fees in Bankruptcy

Most divorce and family law attorneys charge an initial retainer fee and bill against that retainer according to their hourly rate as they work on a case.  As a result, the attorney is guaranteed payment as they work on the case.  If the retainer is depleted and the client doesn't replenish the trust balance by making another payment, the attorney can withdraw from the case.  In essence, the client pays only for work as it's performed and the attorney is guaranteed payment as they work on the case.

However, in some cases, a family law attorney will work on a case without the security of a positive trust balance consisting of a retainer fee.  In these cases, the attorney may be working with the hope that the client will have money after marital property is sold or support ordered.  When divorce attorneys bill by the hour in these instances there is a risk that the client won't pay the bill and debt will accrue.  Unsurprisingly, some clients can't afford their attorney fees after divorce and turn to Bankruptcy for relief.

In chapter 7 bankruptcy divorce and family law attorney fees can be discharged and thereby eliminated as general unsecured debt.  That's possible in cases where the attorney does not have a lien against real estate but rather sends invoices in the hope the client would later pay for services.