BANKRUPTCY FILINGS EXPLODE MANY RUSH TO MEET LAW'S WEEKEND DEADLINE.

Byline: Staff and Wire Services

Facing a weekend deadline, thousands of people armed with bulging files of paperwork lined up at courthouses in Woodland Hills and around the nation Friday to seek bankruptcy protection from creditors before a new law makes it much more difficult to shed debt.

The number of cases filed before the law takes effect Monday was expected to set not only a national record but individual records in a number of states. Some clerks said bankruptcy filing records were beaten every day this week.

At the Central District bankruptcy court in Woodland Hills, the line formed before dawn and grew to nearly 100 people as it stretched outside.

By Friday afternoon, a line of 60 people still stretched outside. Carla O'Connor had to lean up against a concrete trash can after waiting in line for three hours to file for Chapter 7 bankruptcy protection.

``I just found out yesterday about the deadline. If I had known sooner, I would have filed a long time ago,'' said O'Connor, 60, an insurance adjuster from Encino who racked up more than $200,000 in debt from spinal and hip surgery. ``Thankfully, I've never had to file before. But this has been a humbling experience.''

Friday's deadline was complicated by a computer glitch, which prevented bankruptcy attorneys from filing online. Bernal Ojeda, an attorney from Van Nuys, has about 80 bankruptcy filings to get in before the court closed.

``I tried doing them online, but they wouldn't go through,'' said Ojeda, who had a stack of filings under his arm. ``I'm trying to manually file at least 60. I have someone helping me downtown, too.''

The court was allowing people to drop off filings Friday afternoon as long as they had money orders from the U.S. Postal Service. Ojeda said if he doesn't get the filings in, he'll send a letter to his clients stating he will pay for the extra cost when the deadline passes. ``It's not their fault. But it's not my fault, either. The system wasn't prepared for this,'' he said.

The law, the most sweeping reform of the U.S. Bankruptcy Code in decades, sets new limits on personal bankruptcy filing and requires people to get professional credit counseling before they are allowed to file petitions.

It will prohibit most filers with above-average income from filing Chapter 7 petitions that allow debts to be erased. Instead, people deemed to have at least $100 a month left over after paying certain debts and expenses will have to submit a five-year repayment plan under more restrictive Chapter 13 guidelines. The law also sets some restrictions on businesses.

Supporters believe that the changes will help rein in consumers who pile up credit card debt only to wipe it out with a Chapter 7 filing. Opponents say the law will hurt those who incur debt unexpectedly, such as with health problems or lost jobs.

Since President George W. Bush signed the law in April, the number of personal bankruptcy petitions has soared. Preliminary estimates expect a record 200,000 petitions to be filed this week alone, according to Burlingame, Calif.-based Lundquist Consulting, which compiles bankruptcy statistics. The firm said the current record of 102,863 was set last week.

Clerk Yvonne Evans at the U.S. Bankruptcy Court in Atlanta said all 123 employees were called in to help deal with last-minute filers.

``I can't even begin to tell you how extraordinary this is,'' she said. ``The line is wrapped all the way around the 13th floor. It's wild.''