Rep. Mary Franson introduces HF 652: A bill that helps a lot of consumer bankruptcy debtors in Minnesota

One of the major parts of my law practice is consumer bankruptcy and litigation in bankruptcy court related to consumer bankruptcy.  I am a member of the National Association of Consumer Bankruptcy Attorneys (NACBA) and have been for several years.

Bankruptcy is a Federal proceeding that a debtor can bring to absolve themselves of their debts.  At the end of a bankruptcy proceeding, an honest debtor receives a "discharge" order signed by a United States Bankruptcy Judge.  This discharge order absolves a debtor of most debts (there are exceptions to this, but such a discussion is beyond the scope of this post).  For example, credit card debts are generally dischargeable in bankruptcy.

I routinely communicate with my fellow members of NACBA in Minnesota.  These are excellent attorneys with varying political beliefs as diverse as the general population.  For the past few years, a serious issue has been plaguing bankruptcy debtors in Minnesota, our clients.  The issue is debtors having to pay exorbitant filing fees to state court administrators to remove state court money judgments entered on debts that were already discharged in bankruptcy.  While Minnesota Statute 548.181 Subd. 1 states that this removal of judgments should only cost $5.00 payable to the court administrator, the Minnesota State Court Administrator has taken the position that debtors with "default judgments" against them need to pay the full filing fee for an answer to a lawsuit in addition to the $5.00.  In my home County of Ramsey, this extra fee is $327.00, for a total of $332.00 per judgment to be removed.  If a debtor had several judgments, they could easily be forced to pay $1,000 to $2,000 or more to remove their judgments for debts that have already been discharged by the bankruptcy court.  Regardless of political beliefs, almost anyone can run into financial troubles for any number of reasons.

Representative Mary Franson (R- Alexandria) listened to the concerns of Minnesota NACBA members about this common sense issue affecting all kinds of people in Minnesota.  She introduced a bill today, HF 652, to address the bipartisan concerns of NACBA members for their clients.  This bill will prohibit  Minnesota Court Administration from charging these exorbitant filing fees to debtors for filing their applications for discharge of judgments, and keeps the fee at the $5.00 originally set forth by the Legislature.

My fellow NACBA members are absolutely elated that a bill has been brought to fix this injustice that keeps people from getting their fresh start to which honest debtors are entitled.  Bankruptcy is specifically mentioned in the Constitution, so I do mean entitled.  On behalf of Minnesota NACBA members who are my friends and colleagues, our sincere thanks to Rep. Franson for taking a leadership role on this issue.

Please contact your Representative and Senator and ask them to co-sponsor and support this very important bill that will have a very positive effect on Minnesotans trying to get back on their feet.  If you want to know who represents you in the Minnesota Legislature, here is a link to a tool for finding out from the Minnesota Legislature's website.

If anyone has any questions about this issue, please feel free to e-mail me at nathan.hansen@gmail.com.