We have been providing legal services to closely held businesses, farms and families for more than 30 years, helping our clients with succession planning, sale of their businesses and the formation of new businesses.
The role of the attorney in a bankruptcy estate is to meet with the debtor, gather information, and decide if it is beneficial to file bankruptcy. If the decision to file is made, the attorney helps the debtor decide which Chapter to file. The attorney then files the petition in the bankruptcy court on behalf of the debtor. Once the petition is filed, the attorney prepares the debtor for the First Meeting of Creditors and appears with them at this meeting. The attorney handles any communication with the debtor's creditors for the debtor after filing the petition. If after filing, the debtor discovers they left an asset, creditor, or other information off the original petition, the attorney files an amended petition to show this information. The attorney appears on the debtor's behalf at any hearings related to the bankruptcy estate. The attorney may also help the debtor file reaffirmation agreements with the court, and advise if the debtor should reaffirm a debt. In the case of a secured property that is not an asset of the estate, the attorney can help the debtor make arrangements to surrender the property to the creditor.
The filing of a bankruptcy petition causes the formation of an estate. This estate becomes the temporary legal owner of the debtor's property. The Trustee administers this estate.
The trustee's role:
- To determine if there are assets to liquidate.
- To review claims of exemptions or discharge.
The trustee is a representative of the creditors as a whole to protect their interests. The trustee can file objections to claims of exemption or discharge. The judge makes the final decision on these objections.
The trustee in an asset case liquidates the debtors nonexempt assets in a manner that maximizes the return to unsecured creditors.
The trustee pursues any pending lawsuits to the benefit of the estate. The trustee may bring action in the court to recover assets belonging to the estate. He may bring action to recover preferential payments made to creditors 90 days before filing your petition. The trustee has the power to bring action in the court to undo security interest and other pre-petition transfers of property that were not properly perfected under nonbankruptcy law at the time of the petition. The trustee has the power to pursue nonbankruptcy claims, such as fraudulent conveyance and bulk transfer remedies available under state law.
After liquidating all the assets in the case to the benefit of the creditors, the trustee will seek court approval to pay the claimants in the estate according to the order set forth in the bankruptcy codes. After the approval from the court, the trustee will pay the claimants in the estate and will bring action in the court to close the case.
