Everybody is having to do more with less these days – including bankruptcy judges in one of the busiest areas of the country in terms of bankrupt debtors.
U.S. Bankruptcy Court Judge G. Harvey Boswell has announced his retirement effective July 8. Boswell’s court is in Jackson, Tenn., which is part of the Western District of Tennessee, the same district that includes the bankruptcy courtrooms of Memphis.
But because of a stalled bankruptcy judgeship bill Congress has yet to pass, it appears that Boswell’s position will lapse and will not be filled after his retirement. That means rather than the current five bankruptcy judges now splitting the caseload for West Tennessee (four who preside in Memphis in addition to Boswell in Jackson), the work would have to be split among the four Memphis judges after Boswell leaves.
The bill in Congress, if passed, would provide funding that extends the tenure of 30 temporary bankruptcy judgeships around the country. The U.S. House of Representatives has already passed its version of the bill, but it’s languishing in the Senate, where senators haven’t yet agreed on how to pay for it.
One thing that is certain, at least locally, is that the bankruptcy cases still would have to be heard. And David Kennedy, chief bankruptcy judge for the U.S. Bankruptcy Court of West Tennessee, said some of the judges here would likely trek to Jackson to hear cases instead of asking the debtors there – already hard-pressed for cash and who would be spending money on gas for the hour-long drive here – to come to Memphis.
Kennedy also tipped his hat to Boswell, who, in addition to leaving his trial judgeship, also will no longer sit on the Bankruptcy Appellate Panel of the Sixth Circuit Court of Appeals.
“I think Judge Boswell has been an outstanding bankruptcy judge,” Kennedy said. “He has served the Western District of Tennessee well. He’s been a dedicated public servant, and he will be dearly missed.”
Lack of congressional action on the bill to fund the judgeships means the country would lose almost one-tenth of its current 351 bankruptcy judges. Even Manhattan, where some of the biggest bankruptcy reorganization cases unfold, has not been immune.
At the same time, the number of bankruptcies filed in West Tennessee in 2011 was a little less with the total in 2010 – 17,386 last year compared to 17,968 in 2010, according to The Daily News Online, www.memphisdailynews.com.
Part of the reason behind the slight drop may be that more debtors simply can’t afford the bankruptcy filing fees. That’s according to Memphis bankruptcy attorney Joe Townsend.
It costs $306 to declare Chapter 7 bankruptcy in West Tennessee, according to the most current notice on the local court’s website.
Townsend told The Daily News in January he’s seen some clients convert from Chapter 13 plans to Chapter 7 plans because they couldn’t afford the debt repayment system set up by the court under Chapter 13. Chapter 7 is a type of bankruptcy case in which a debtor might get to wipe away most of what they owe, whereas debtors set up repayment plans under Chapter 13.
Townsend also said he’s seen many people give up their houses recently because they couldn’t afford them. It was an anecdotal way of illustrating that the problem of hard-pressed debtors still remains acute in West Tennessee.
One of the four remaining bankruptcy judges in Memphis, George Emerson Jr., was recently appointed to succeed Boswell on the Sixth Circuit Bankruptcy Appellate Panel. Emerson will continue to serve as a trial bankruptcy judge here, in addition to reviewing decisions of bankruptcy judges from other judicial districts in the Sixth Circuit as a member of the panel.