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Is an apology a good idea when filing for bankruptcy?

It is not uncommon for bankruptcy attorneys and their clients to discuss courtroom strategy prior to going before the judge, who will ultimately decide whether to approve their bankruptcy plans. To aide in that discussion, two law professors recently released a study to determine whether or not a simple "sorry" can help. Tennessee residents considering filing for Chapter 13 bankruptcy might find these professors' study on apologies and bankruptcy filing interesting.

According to the study, the law professors, from the University of Illinois, tested nearly 140 bankruptcy judges, approximately one-thirds of the federal bankruptcy bench, to determine if apologies effected the outcome or approval of a Chapter 13 bankruptcy repayment plan. While the Bankruptcy Code is mum on the issue, legal professionals have long discouraged clients from apologizing in court for fear that an apology sounds like an admission of guilt.

In order to put the matter to rest, the researchers proposed the story of a fictional family filing for bankruptcy to the judges. At the end of fictional families Chapter 13 repayment plan, which included identical financial information, the researchers included a brief apology in half of the plans. In the end, 40.6 percent of the judges who received a plan with an apology approved it, compared to 34.4 percent who did not receive a plan with an apology.

While at first glance it may appear that an apology can affect the decision of a bankruptcy court judge, the fact remains that the difference between the two groups is statistically insignificant. In most cases the decisions of bankruptcy judges can be complex and multi-dimensional. When it comes to making an apology, like all important decisions regarding a persons bankruptcy filing, it is a good idea to discuss the matter with a professional first.

Source: The Wall Street Journal, "Do Apologies Matter in Bankruptcy?" Katy Strech, Feb. 15, 2013.

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