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Frequently Asked Creditor Bankruptcy Questions
How Do I Find Out Who The Trustee Is?
In a Chapter 7, the trustee is named on the notice of the first meeting of creditors, which is sent to every listed creditor. That information is also available in the case file at the bankruptcy court and over the phone in some districts. In most Chapter 11 cases, there is no trustee. The debtor assumes the duties of a trustee as “debtor-in-possession.” The United States Trustee (UST) is different from the case trustee. USTs are employees of the Department of Justice and have oversight, but no day-to-day operating responsibilities, of bankruptcy cases.
I Got A Notice Of The Debtor’s Discharge And My Claim Has Not Been Paid. What Can I Do?
The timetable on which the debtor gets a determination of his or her right to a discharge is not related to the administration of the case by the trustee. The trustee continues administering the estate. All nonexempt assets are located, the assets are sold, claims are reviewed, fees determined and the creditors are paid to the extent there are assets according to the priority of the claim.
The debtor’s discharge doesn’t necessarily end the case nor keep the trustee from pursuing assets for the benefit of creditors. Remember, however, that the vast majority of individual Chapter 7s have no assets from which creditors can be paid.
Do I Have To Go To The 341 Meeting To Have My Claim Paid?
No. The first meeting of creditors is a fact-gathering event. Allowance and payment of your claim is not tied to being at the 341 meeting. However, claims must be filed by the time established by the court in the notice to file claims.
As A Creditor, Do I Need A Bankruptcy Lawyer?
Not usually. In order to be paid in a bankruptcy proceeding, the creditor usually has to file a proof of claim form. It summarizes the claim and its priority. You don’t need a lawyer to fill out the form. Attach to the form a copy of the invoice or contract in question, or a summary of the elements that make up the claim. Claims are freely amendable if you make a mistake or omit something. If you didn’t get a proof of claim form, get one online.
My Employer Filed Bankruptcy Owing Me Money. What Can I Do?
Employee claims for wages earned in the 90 days prior to the bankruptcy filing (or the debtor ceasing operations, whichever comes first) are a priority for payment. However, distribution on priority claims may not take place until the case is nearly over.
When filing a claim, check the box on the claim form claiming a priority claim, and wait. You can also get forms from the court clerk or get claim forms online. Keep the court informed if your address changes, otherwise, they can’t find you to mail the check.
I Only Heard About The Bankruptcy Case And Did Not Get A Notice From The Court. What Must I Do?
If you know about the bankruptcy case, even informally, you must act to preserve your rights. Most courts hold that if you have actual knowledge of the case, however obtained, you are bound by the filing deadlines for objections to dischargeability and for filing claims. The court can search its records for the case number of a debtor. File a request to be added to the master address list in the case. Keep the court informed if your address changes.
How Do I Get My W-2 From A Bankrupt Employer?
Contact the trustee in the case immediately. This is a task the trustee is supposed to accomplish. The trustee has control of, or the right to control, the debtor’s books and records that may be necessary to get the W-2 generated. Don’t wait until next year’s tax returns are due to work on this issue. By that time, the trustee may have closed his or her file and disposed of the records.
Can I Collect My Claim From The Corporate Officers Or Shareholders?
That depends on whether there are facts making the officers or shareholders liable for the debt. Just being a shareholder, or even the only shareholder, doesn’t make one liable for the corporation’s debts. Those individuals could be liable if they guaranteed the debt or if they ignored the corporation’s separate legal standing to the extent that creditors can pierce the corporate veil.
What Can I Do If My Account Debtor Is Fraudulently Disposing Of Assets?
Creditors can file an involuntary bankruptcy against a debtor who is not generally paying his or her undisputed debts as they come due. 11 U.S.C. 303. The petitioning creditors must hold at least $11,625 in undisputed, unsecured claims. If the court finds that the petitioning creditors have met their burden of proof, an order for relief in bankruptcy is entered, and a bankruptcy case is commenced.
I Have A Co-Signer Or Guarantor For My Claim Against The Debtor.
What a creditor can do in this circumstance depends on what chapter the debtor filed. Only if the debtor filed a Chapter 13 bankruptcy is a creditor prevented from collecting from other obligors. In Chapter 13, the co-debtor protects co-obligors and guarantors on consumer debts. To proceed against them, a creditor must get relief from stay. In any other chapter or if the debt is not a “consumer debt,” creditors are free to pursue guarantors or co-obligors, the bankruptcy of the principal notwithstanding.
Can My Judgment Be Discharged?
The discharge of any debt depends on the kind of claim that underlies the judgment and the chapter of bankruptcy involved. Just because your debt is reduced to judgment does not necessarily prevent it from being discharged. If the judgment is for a contract debt, such as a promissory note or trade account, it is likely dischargeable.
If the judgment is one for fraud, it cannot be discharged in Chapter 7 if you file a nondischargeability action, but can be discharged in Chapter 13.
Remember that if the judgment is secured by a perfected judgment lien, which attaches to value owned by the debtor, you are a secured creditor. Liens generally survive the bankruptcy as a charge on the property of the debtor. The lien may be avoided if it impairs an exemption or is stripped down to the present value of the collateral in a Chapter 13.
My Tenant Filed Bankruptcy. What Can I Do?
If the agreement by which the debtor occupied the property has been breached, before the filing, you can seek relief from the automatic stay to begin or continue eviction. When the leased property is not the debtor’s residence, the trustee or debtor-in-possession must assume the lease within 60 days of the filing, or it is deemed rejected. If the lease is rejected, the trustee cannot attempt to assign the lease to a third party.
Even though the lease is rejected, the trustee may have a continued right to occupy the property if assets of the estate are located there until they can be sold or relocated. Know, however, that post-petition rent is an administrative claim, which has equal status for payment with the trustee’s commission from the assets of the estate.
We encourage you to call 515-421-9068 or use our online contact form to schedule a free one-hour consultation with a lawyer who emphasizes on clear communication and cost-efficient solutions. We will review your situation and recommend an effective course of action.