Canus Lupus in Bankruptcy

The domestic dog, member of the Canus Lupus Species, Canidae Family, Carnivora Order, and Cute-and-Furry Genus represents a matter of interest in bankruptcy. 

The Price is Right

Schedule B of the bankruptcy petition lists the bankruptcy debtor's worldly possessions.  And then some.  It may seem a straightforward document; yet it includes 35 categories including catch-all provisions.  Thus, it provides for infinite asset-itemization.  The bankruptcy attorney must rely on the client to faithfully report what they have, what they will have, and what they might have.  Upon further inquiry pursuant to the mandates of §707(b)(4)(D) and F.R.B.P. 9011(b), and Common Sense, he must faithfully, accurately, and fully report the assets in the appropriate level of detail.  Assets may be significant (in value) or trivial; yet, your bankruptcy attorney reports the values of both compelling and mundane things.  A sometimes forgotten category of asset is animals. 

A bankruptcy debtor may name her own price, and declare her animal "priceless."  Yet, we insist: name a price.  In chapter 7 bankruptcy, a trustee is charged with assessing the values of your goods; she must ascertain whether items are of excessive value that merits liquidation.  [The horse owner may rest assured liquidation implies sale, not conversion to glue.]  The trustee demands a number, so we give it. 

Fortunately, California has decent bankruptcy exemptions, which when employed correctly, permit retention of all assets, some 98% of the time.  No kidding--which is why bankruptcy is a powerful solution for 1) ridding oneself of debt, while 2) not losing the shirt off one's back (or anything else most often).  It's outside of bankruptcy that borrowers suffer loss: garnishment, levy, repo, foreclosure.  In bankruptcy shed the weight, yet keep your stuff.  That is the famous fresh start.

Hence value must be prescribed to every asset.  This includes Canus Lupus.  

It is the dog owner's input that populates Schedule B, which incorporates household chattels and  values.  The bankruptcy attorney must ensure completeness of Schedule B.  Now, often a dog on the rug is the proverbial fly on the wall.  Hence, upon the client's waiver of confidentiality, I routinely submit a draft of Schedule B to the family dog. 

A mute observer keen to the lay of the household, the dog may provide input on the owner's inadvertent omissions of tangible goods.  Yet, it's primarily the input--not the omissions--that Canus Lupus disputes.  Invariably, the animal rings me up and questions why they, themselves are valued at $20. I say, if you have bones take it up with your master. 

In truth, $20 might be generous.  Except for companionship and shed hair, Canus Lupus commonly contributes nothing.  He is a liability, not an asset.  If one's dog is good, he still demands the most foul form of clean-up rain or shine; inevitably loses one's rental-deposit; smells nearly as bad as a teenage boy.  If one's dog is bad, he incessantly barks, though he has nothing of import to say; he bites; he's more Lupus than Canus.

Yet, one would be remiss to ignore the exceptions.  Some animals' value might exceed the $550 single-household-good allowance under the bankruptcy exemptions of California Code of Civil Procedure §703.140(b)(3).

Working for a Living

Most dogs are not productive members of society. Yet, a minority possess redeeming qualities.  What if the bankruptcy debtor's dog is...
A guide dog, who leads the blind?
A therapy dog, who comforts the sick?

A mighty retriever in high hunter-demand; she who retrieves shot-game, not tennis balls?
A highly-trained guard dog, who kills and maims (on a professional level)?*
A show dog?
A breeding animal?
In all those, there is commercial value.

Assume you have a genetically-blessed breeding dog named Chelsea; she's worth $35,000.  Her value is not fully covered by the the usually-available CA-bankruptcy-wildcard-exemption of $23,250 (present value subject to dollar adjustment).  What will happen if you file chapter 7 bankruptcy?  The chapter 7 bankruptcy trustee may sell Chelsea; from the proceeds you'd be paid only the exempt portion equal to your available, and allotted wildcard exemption.  Or, the trustee may abandon her.  An asset that exceeds the exemption allowance (or what you get to keep) is not necessarily liquidated if its cost of possession and sale would not yield meaningful proceeds.  Or if it's more trouble than it's worth.

To enable that last disposition, you would demand Chelsea's company at the bankruptcy Meeting of Creditors.  (This is the the mandatory appearance one attends 20- to 40-days after filing bankruptcy; this bankruptcy attorney will be there to represent you, so no sweat.)  If your displayed intimacy with the beast is apparent, the bankruptcy trustee may doubt the efficacy of pursuing its sale. The otherwise marketable beast may not be marketable sans its master; it may lose its will and not serve another.  And if Chelsea has 4-legged siblings of the mutt persuasion, bring them too on the off-chance your bankruptcy trustee has read Where the Red Fern Grows.  Because sympathy grows. 

In all likelihood, the bankruptcy filer less likely has a super dog than some species with generally intrinsic value: horses, tigers (Mike Tyson has one), exotic birds, Angry Birds (that are exotic), Vietnamese Pot-bellied Pigs (George Clooney had one), fancy aquarium fish (and their aquariums).  Animals aren't created equal.... at least not on bankruptcy Schedule B.

So, the next time you talk to your dog, look him in the eye and ask: what are you worth, you son of a bitch?  

Now, if your dog is the above-described Bad Dog you might be tempted to inflate its value above and beyond  the exemption limits.  You may hope the chapter 7 trustee will turn him over to your least-favorite creditor, the one who called you at work, threatened and belittled.  The one who deserves a bite in the ass.

That would be priceless.**

Asaph Abrams is a San Diego Bankruptcy Attorney. He has 2 cats, 3 boys, and 1 wife (not necessarily in that order).  Asaph is a cat person, yet regrettably must put up with his relatives' many dogs. Many, many dogs.   Okay, two dogs.  However, he'll privately confess that his indifference to Canus Lupus stems from sadness because his own dog died too soon.

San Diego Bankruptcy Attorney, Asaph Abrams
Offering free, no-obligation chapter 7 bankruptcy and chapter 13 bankruptcy consultations in San Diego. Visit us at http://www.bankonitsd.com/ or call 858-344-0500. E-mail admin@abramslawsd.com to set an appointment. Also representing Imperial County residents.

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*When you're done here, read this NY Times piece on some charming 4-legged fellows.
In lieu of Kevin Costner

**Alas, creditors aren't really paid in kind.