Perle

Under the bankruptcy rules, a creditor has a limited window of time in which to challenge the dischargeability of certain kinds of debts. That window stays open, though, if the creditor doesn’t receive adequate notice of the bankruptcy from the debtor. The question in this case is whether the creditor’s lawyer’s knowledge of the bankruptcy constitutes notice to the creditor. In the abstract, it well might. But here there’s a wrinkle: The lawyer learned of the debtor’s bankruptcy during his representation of another client, and although the lawyer continued to represent the creditor on other matters, he no longer represented the creditor in relation to the debt at issue. On these facts, we hold that it stretches the agency principle too far to impute the lawyer’s knowledge of the debt- or’s bankruptcy to the creditor.

I. Factual Background

Cery Bradley Perle filed for bankruptcy under Chapter 7 of the Bankruptcy Code in 2001. Among Perle’s outstanding debts was a $350,000 arbitration award to Fiero Brothers, a New York securities dealer. The award was made in 1998 by a National Association of Securities Dealers (NASD) arbitration panel, which found that Perle had…