Bankruptcy Clinic Students Save Legacy in Decade-Long Advocacy

The Eleanor R. Cristol and Judge A. Jay Cristol Bankruptcy Pro Bono Assistance Clinic at Miami Law offers pro bono legal services to low-income individuals who are dealing with bankruptcy.

Since 1995, the University of Miami School of Law’s bankruptcy clinic has given current Hurricane law students the opportunity to deliver life-changing pro bono legal services to indigent clients throughout South Florida.

Bankruptcy attorney Patricia “Trish” Redmond founded the clinic at the school where she still serves as an adjunct professor. A 2019 Tobias Simon Pro Bono Award Winner and shareholder at Stearns Weaver Miller, Redmond devotes between 200-400 hours every year to her pro bono work, which benefits thousands of underprivileged and low-income individuals, children, and families.

Bankruptcy cases are far from easy. A simple Chapter 7 can last up to six months while a more complex Chapter 13 can take up to five years, which makes the case Redmond and her team just completed all the more shocking.

“This case came to the clinic around 2010,” Redmond said. “Thirteen years’ worth of law students worked on this case.”

As Redmond explained, the debtor, a construction worker on dialysis, had lost his home in a Chapter 13 bankruptcy case. The only thing he had left was a little rental house in Homestead that his father had left him.

“At the time we got it appraised it was worth $57,000,” Redmond said. “It was a bad neighborhood in Homestead. They had about a $250k mortgage on it. We were trying to save it.”

Redmond said her team of law students went through several strategies but ultimately decided to initiate a Chapter 13 case; the only problem was it had a massive balloon payment tagged to the end of the mortgage.

“We were hoping at the end that the debtor would have been in better circumstances, or the property would have gone up,” Redmond said. “Neither was the case, and we couldn’t make the balloon payment.”

During the Chapter 13 case, Redmond said the students were involved in evidentiary hearings.

“They argued various motions before the court under the internship program we have with the bankruptcy court,” Redmond said.

Through the local bankruptcy bar foundation for the Southern District of Florida, students are allowed to work on bankruptcy cases with the supervision of a lawyer. Redmond also serves as the director of all clinical programs that are funded by the district.

The case went through several years of mediation, which was unsuccessful, and Redmond’s team changed strategies.

“With Chapter 13, he had to pay it [mortgage] all off in five years,” Redmond said. “He couldn’t do that even at a minimal rate of interest. He could make payments over a longer term and under Chapter 11 you could make payments over a longer term, so we filed that.”

As the team went from Chapter 13 to Chapter 11, as the years went on, Redmond says the debtor’s health began to deteriorate.

“He was going through dialysis two or three times a week,” Redmond said. “He was the longest-surviving person in his dialysis group. Despite all the physical things going on with him he kept being resilient. We thought if he was doing all those things, the least we could do was try to save his house.”

As the team transitioned to Chapter 11, the debtor finally succumbed to his health issues and passed away. Then the bankruptcy case needed a probate attorney to handle the late debtor’s estate.

Enter Jerry Markowitz, founding shareholder of Markowitz Ringel Trusty + Hartog. Markowitz concentrates his practice in the areas of creditor and debtor rights. His firm is no stranger to pro bono, winning the Florida Supreme Court’s 2002 Law Firm Commendation Pro Bono Service Award.

“When the debtor died…the bankruptcy case was a ship without a rudder,” Markowitz said.

Markowitz said his law partners Lian De La Riva and Carly Weiss appeared before the probate court to ask if the debtor’s son could be named personal representative over the father’s probate estate, with the understanding that the bankruptcy court would deal with paying the creditors.

As the case moved to Chapter 11, Redmond said her law students learned the lessons of the Chapter 13 failure.

“As we worked through stuff, we got smarter about the process and smarter about mediation,” Redmond said. “We knew that mortgage companies were very respectful of what a judge says. In our second mediation, rather than going with a private mediator, we went with one of the bankruptcy judges.”

The bankruptcy judge in question was Judge Paul G. Hyman, Jr.

During Hyman’s mediation, Redmond says they agreed with the mortgage company on the value of the property and to pay that amount and to sell the property to the debtor’s son so that he could pay off the mortgage based on the true value of the home.

Once the son had control over the estate and the mortgage, the property value started going up.

“When we valued it in 2019 it was worth $157,000,” Redmond said. “Property values continued to go up during the pandemic. The son had it and he started making payments and they decided to sell.”

In stepped Markowitz again, who along with fellow firm attorney Thomas Ringel, helped close the house for the son.

“Ultimately the bankruptcy case continued, the property was going to be sold, and the son could sell it,” Markowitz said.

During the settlement, Redmond said that her former students who worked on the case came back to help.

“A lot of the students who are practicing now from all over the United States called into the Zoom hearing,” Redmond said. “It was an awesome result.”

Markowitz, who is also Redmond’s husband of 38 years, acknowledged his firm’s role in the case but said, “I was just the tail wagging the dog; 95% of the work was by Tricia and her students.”

Redmond says 13 years’ worth of students received a wealth of training during the case.

“They learned so much on it,” Redmond said. “For example, they cross-examined an appraiser and got experience doing evidentiary hearings in bankruptcy court while they were still students. I think everybody who worked on this case was committed to it because the client was such a good guy.”

Once the case was settled, the debtor’s son was able to sell the house and make a profit. In turn, he donated $1,000 to Dade Legal Aid’s Put Something Back campaign. Markowitz said the client really wanted to give back.

“I told them we’re not allowed to charge you a fee so give money back to pro bono and it was a cool thing that they did that,” Markowitz said. “It’s unusual that pro bono clients end up in a position where they can actually pay.”

Redmond claims that Dade Legal Aid, who initially referred the case, is the real hero.

“We couldn’t do what we do without Dade Legal Aid,” Redmond said. “They are our partners and they provide help and input and support all the way through.”

Read more about Miami Law’s clinics.