Texas Justices Likely Favor Bankruptcy Decision on Malpractice

The Texas Supreme Court likely lacks the authority to cancel a federal bankruptcy court-approved plan that pays creditors with a $20 million legal malpractice judgment, a justice said.

During oral arguments Thursday, Justice Brett Busby suggested that the court is powerless to change the status as creditor of a property owner at the center of a botched real estate deal that drove a brokerage into bankruptcy.

“We can’t change that,” Busby said.

The justice added that the bankruptcy shouldn’t erase the malpractice judgment: “I’m having a hard time seeing that just because you go into bankruptcy your cause of action ...