Bankruptcy filings in Hawaii continued to stabilize in March, but the volume of cases remained relatively high by historical standards, according to data released yesterday by U.S. Bankruptcy Court.

There were 358 cases filed last month compared with 357 in March 2010, the court reported. For the first three months of the year, bankruptcy filings have averaged 297 per month, down from an average of 330 per month in 2010.

Financial hardship fueled by the recession caused bankruptcy filings to increase steadily in recent years after averaging just 80 cases per month in 2006.

Although there are glimmers of improvement in Hawaii’s economy, many residents are still burdened by excessive debt loads built up during the recession.

Attendance at a monthly bankruptcy clinic offered by the Legal Aid Society of Hawaii has been at capacity since it was restarted last July after a five-year hiatus.

Many of those accepted into the program find themselves in financial trouble after losing a job, having their hours cut or being put on furlough, said Madeleine Young, a staff attorney at Legal Aid’s Consumer Unit. In addition to running the Bankruptcy Pro Se Clinic, Young occasionally represents clients in bankruptcy proceedings.

"I do think it’s part of a trend that we’re seeing as a result of the economic downturn," Young said. "We often hear from our clients that they have a part-time job and are hoping to get another one or full-time work.

"But until that happens they don’t have much choice. We see a lot of people who are just able to make their minimum payments and suddenly lose a source of income," she said.

Legal Aid accepts five to six people for each two-session class where they learn how to file bankruptcy under Chapter 7 of the federal bankruptcy code without an attorney. In the first four-hour session, they are familiarized with the necessary forms and shown how to fill them out.

In the follow-up session, Young reviews the forms to make sure they are in order.

Of the cases in March, 271 were filed under Chapter 7 liquidation; 85 under Chapter 13, which allows wage earners to work out a repayment plan over three to five years; and two under Chapter 11 reorganization.

The majority of the total cases, 219, were filed in Hono­lulu County. Maui County had 63 cases, while the Big Island had 47 cases and Kauai had 29 cases.