St. Mary's Law Journal


Bankruptcy courts see too many incompetent bankruptcy lawyers, and the courts have few options for dealing with them. A court can rule against the lawyer, but this strategy punishes the lawyer’s client, who may be an innocent bystander. Alternatively, nothing prohibits a judge from deciding to hand down a sanctions opinion. Sanctions opinions arise when one party makes a request, or the court believes a lawyer’s behavior is serious enough to merit a written order. These instances include flouting the law—either bankruptcy law or the ethical rules—or being unaware of the fundamentals of bankruptcy practice and policy. In the instance of a sua sponte written order, these court-initiated sanctions are written after the lawyer has crossed the line of reasonable behavior. When a sanctions order has been issued, often the recipients have the option to appeal. As with court-initiated sanctions opinions, however, in non-bankruptcy cases no party represents the court’s reasoning on appeal. The reviewing court can take any one of four positions: (1) it can affirm the court’s decision; (2) it can reverse the decision on procedural grounds; (3) it can reverse the decision due to an inappropriate understanding of the decision; or (4) it can disagree with the bankruptcy court. Yet, there are two injured parties when a sanctions opinion is written—the client and the legal system. While the injured client may have a voice during a sanctions appeal, the legal system merely has an empty chair. Courts need a system which educates Article III judges of the intricacies of bankruptcy law. Alternatively, the Office of the United States Trustee can take a greater role in appeals. A third option is to have courts appoint an expert to represent the court’s position on appeal, which ensures the court understands the significance of the behavior.


St. Mary's University School of Law