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B&SAs a result, other than a few hundred dollars earned from odd jobs, Robert had spent some two years relying on $366 per month in public assistance to support his family: his wife, their two young children, and his mother and her young daughter, all crammed together in a small apartment. Monthly rent was $102. His only assets were the clothes on his back, a handful of household necessities worth $50, and a couch of negligible value that was in storage, presumably because there was no room for it anywhere else. His youngest child, an 8-month-old boy, was in a Brooklyn hospital undergoing treatment for cystic fibrosis.
With no prospect of relief in sight, Robert made the hard decision to file for bankruptcy. I earnestly seek a discharge in bankruptcy in order to relieve myself and my family of the distress of financial insolvency and creditor harassment and in order to make a new start in life, he said. When I do get a job, I want to be able to spend my wages for the support of myself and my family and for the medical care of my son, instead of paying them to my creditors and forcing my family to remain dependent on welfare.
When Robert went to the courthouse to file, however, he hit another wall: The clerk wanted $50 in feesabout $360 today. Federal law allowed him to pay those fees in installments of a few dollars per month. But, Robert said, he couldnt guarantee he could do so in his financial condition. (He was, after all, bankrupt.) Hed tried to borrow more from his family and friends, to no avail; hed already borrowed from his wifes grandmother, whom he could not pay back. And his infant son was set to be released from the hospital soona joyous occasion, and also another person to care for in a household stretched to its breaking out.
So Robert sued, arguing that the mandatory filing fees violated his constitutional right to due process. Because the legal system had a monopoly on the only mechanism by which he could get his life back, he argued, his presence in bankruptcy court was no more voluntary than that of a criminal defendant hauled before a jury to face years in prison. A federal district court agreed, reasoning that the governments interest in collecting $50 was not compelling enough to force broke, desperate people to pay it.
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Bettie
(16,089 posts)there are a few exceptions, but not many.
Our country is run by the wealthy and for the benefit of the wealthy.
Many Democrats try to help those who are not in that class, but ultimately, there are more looking out for their own self-interest and their own social class than there are looking downward, economically speaking.
The courts are even worse, working against common folk in nearly every ruling.
Igel
(35,300 posts)Bankruptcy isn't a right. It's an imposition.
It's unclear what debts needed mitigation. I infer that MetLife had a claim on the premiums that were stolen from him and he couldn't front the money for. (It's not clear that's the only debt. Let's be foolish and assume it is.)
The problem was MetLife gave him a bad reference, so he couldn't secure work. (And let's assume that's the only issue, with scant basis in fact.)
It's not genius-level reasoning to go to MetLife and say, "Look, I'll never be able to pay you the full amount given how things are now. How's this? I pay you 30%, starting 4 months after I get a job, amortized over 10 years at 2% interest, and you give me a decent reference so I can get an honest job?"
If "No creditor has anything to gain by voluntarily settling a debt with someone who has nothing to offer," notice this is a proposal to settle a debt who just might have something to offer. MetLife is not worse off if the deal fails (except on their P&L, where Kras-as-asset is trivial, for a year). And yet they might gain a shekel or two.
And if Kras goes ugly and doesn't keep his end of the bargain, Kras has violated the contract and they come after him again.
Note that being granted debt mitigation wouldn't have helped his job-reference problem, just relieved his debt and fixed his credit score. Employers didn't check credit scores in the early '80s, so I'd guess they didn't in '70. And the $50 he would owe