Can an attorney's "lien on the proceeds" of a divorce be discharged in Chapter 7 Bankruptcy if all other qualifications of Chapter 7 are met?
The "proceeds" are the ex-husband's 401K that was awarded to my friend and the verbage of the Agreement for Legal Services included "retirement accounts".
Background: My friend signed up with an attorney and let him put a "lien on the proceeds" of her divorce settlement because she had no money to pay for his services and was being pushed out of a foreclosed home with her disabled old son.
She thought the attorney's services would cost about $5,000 (because that was the minimum fee written on the agreement) but the attorney ran up an $11,000 bill in less than 2 months (therefore putting a financial noose around her neck) and continued to run bill up to $28,000.
There was no trial in this case. My friend who is of slightly diminished capacity (2nd grade reading, never worked, etc.) definately did not understand the agreement and even if she had understood thoroughly that $5,000 was only the minimum fee - the attorney's "run the bill up fast and keep on going" tactic seems very abusive.
Again - Can an attorney's "lien on the proceeds" of a divorce be discharged in Chapter 7 Bankruptcy if all other qualifications of Chapter 7 are met?