Chapter 7 Trustee Jason Gold Jason Gold is one of the four Chapter 7 trustees in the Alexandria Virginia Bankruptcy court. When you file a bankruptcy case in Alexandria, the computer assigns you to one of the four trustees.   Being a Chapter 7 Trustee is a part time job for lawyers. Gold is a partner […] The post Chapter 7 Trustee Jason Gold by Robert Weed appeared first on Northern VA Bankruptcy Lawyer Robert Weed.

New York has adopted a new  Uniform Voidable Transactions Act (“NYUVTA”), to replace New York State’s existing fraudulent conveyance law, which was over 100 years old.NYUVTA is effective as of April 4, 2020. Transfers that occurred prior to April 4, 2020 are governed by NYS former fraudulent conveyance law.NYUVTA can be found at N.Y. Debt. & Cred. Law §§ 270-281NYUVTA provides for a 4 year statute of limitation, unlike NYS’s former  fraudulent conveyance law, which provided for a 6 year statute of limitations. NYUVTA also provides for a period of one year after the transfer in question to avoid a transfer to an insider—similar to the Bankruptcy Code’s insider preference reach back period of one year prior to the petition date, under 11 U.S.C. § 547(b)(4)(B)NYUVTA eliminates the “good faith” element of a fraudulent transfer and adopts the “reasonably equivalent value” requirement of the Bankruptcy Code. 11 U.S.C. 548  NYUVTA provides for a cause of action to avoid transfers to an insider if the insider had reasonable cause to believe that the debtor was insolvent. N.Y. Debt. & Cred. Law §274(b).Insolvency. Plaintiffs pursuing fraudulent transfer claims to collect unsatisfied judgments will now be required to prove insolvency in connection with a fraudulent transfer claim. Burden of Proof.  NYUVTA provides that a creditor challenging a transfer bears the burden of establishing the elements of its claim by a preponderance of the evidence, rather than the higher "clear and convincing evidence" standard under the former fraudulent conveyance law.Presumption of Insolvency. NYUVTA provides that consistent with section 303(h)(1) of the Bankruptcy Code,  any nonpayment of debts subject to "bona fide dispute" is not presumptive of insolvency; and (ii) expressly provided that the burden to rebut this presumption falls on the "party against whom the presumption is directed.Conflict of Law. NYUVTA provides that the law of a debtor's place of business or if the business is conducted in more than one state, the place in which the business had its chief executive office, at the time that a transfer was made, applies to claims under NYUVTA. Attorneys Fees. Section 276(a) of NYUVTA allows for the award of reasonable attorney fees as an additional amount required to satisfy the creditors’ claim.Foreclosure Sale and Reasonably Equivalent Value. Section 272(b) of NYUVTA provides that reasonably equivalent value is given “if the person acquires an interest of the debtor in an asset pursuant to a regularly conducted, non-collusive foreclosure saleFor questions regarding NYS new Voidable Transaction law please contact Jim Shenwick 212 541 6224 [email protected]

   The amount of fees allowed to a substantially oversecured creditor, Farm Credit, in a complicated chapter 12 case was at issue before Judge Collins in In re Kurtenback, 2020 Bankr. LEXIS 3336, Case No 18-01607 (Bankr. N.D. Iowa, 30 Nov 2020).   Debtor had proposed five chapter 12 plans from April 2019 until filing a liquidating plan on 30 October 2020.  The plans were unusual in that they had different options depending on the occurrence of certain circumstances.  Farm credit objected both to the form of such plans, as well as to feasibility.   Farm credit required its counsel to allocate the billing over five different loan files, further complicating the review of the bills.  There was no dispute that Farm Credit was substantially oversecured in the case.   Judge Collins noted that the allowance of fees and costs to oversecured creditors is governed by §506 of the Bankruptcy Code.  This provides To the extent that an allowed secured claim is secured by property the value of which, after any recovery under subsection (c) of this section, is greater than the amount of such claim, there shall be allowed to the holder of such claim, interest on such claim, and any reasonable fees, costs, or charges provided for under the agreement or State statute under which such claim arose.11 U.S.C. 506(b) (emphasis added).  Three elements are required by this section: 1) that the creditor is oversecured in excess of the fees requested;  2) that the fees are reasonable, and 3) that the agreement giving rise to the claim provides for attorney fees.1      The court initially examined the reasonableness of the fees.  The courts have broad discretion under the reasonableness standard to meet the purpose of §506(b) to prevent creditors from failing to exercise restraint in the fees and expenses incurred.  Courts should look to see if the creditor is exhibiting excessive caution, overzealous advocacy, and hyperactive legal efforts.2  This requires an examination of factors including the complexity of the case; the hourly rates charged and the rates in the locality; whether the services were necessary to protect the client's interests; whether attorneys were able to efficiently and competently provide the requires services; whether billing judgment was exercised to avoid duplicate or unnecessary services; the results obtained; and the amount charged in similar cases.  As to the complexity of the case, Judge Collins noted that the multiple plans added to the case's complexity and required additional time and effort by the parties, as did difficulties involving the debtor's participation and cooperation in the case.  However these issues appear to have caused some 'excessive caution' by Farm Credit, which §506 is intended to check.    The court found that the hourly rates charged by Farm Credit were reasonable, being quite a bit below rates charged by Debtor's counsel.  The Court also found that the services of Farm Credit's counsel were generally necessary to protect it's $2,000,000 oversecured position.  However, the court noted duplication of effort and lack of efficiency as described below reduced the necessary fees incurred.  Finally, the court disallowed $6,000 for work on a motion for relief from stay which motion was abandoned as being unlikely to prevail given the creditors oversecured position.  The primary concern of Judge Collins related to efficient and competent services.  While finding that counsel were competent, indeed some of the best attorneys to appear before the court, he found a number of issues as to efficiency.  The Court looks to efficiency with an eye toward fairly preserving the value of the bankruptcy estate, thus imposing on creditor's counsel a requirement that they exercise restraint in the fees and expenses incurred.   The confirmation hearing was scheduled 8 times, with only one evidentiary hearing held, requiring a one day trial.   Farm Credit did a full preparation, including a new witness and exhibit list, exhibits, witness preparation, outline of testimony, preparation of memoranda of authority, cash-flow analyses, and details on objections for each hearing, resulting in a total of 450 hours of work related to at most one full day hearing.  The time entries, such as 'continued work on objections and exhibits for Second Amended Plan hearing in Cedar Rapids; work on lengthy objections, preparation of exhibits and exhibit list; research and briefing on status of plan objections; feasibility and other objection 2.6 hours'  and 'work on preparation of hearing on preliminary hearing in Cedar Rapids on Third Amended Plan; work on Exhibit List, Witness List and Memorandum of Authorities; preparation for presentation' show a pattern of repetitively billing large blocks of time for the same activities inconsistent with this efficiency requirement.  As another example, between May 8 2019 and September 4 2020 Farm Credit's counsel billed for preparing and reviewing witness and exhibit lists over 80 times.  The same type of billing practice exists as to research and briefing feasibility objections, working on trial briefs and memoranda of authorities, and working on cash flow analyses.    Judge Collins had similar issues with the requirement to consider billing judgment and avoid duplicative services.  Billing judgment requires that counsel staff a file in a manner that efficiently provides the most cost-effective representation necessary to a client's interest without redundant, duplicative, and unnecessary services, as well as a final review of the bills to ensure they meet the requirements of §506.  The court found substantial duplication of efforts in the billings submitted by Farm Credit, such as 66.1 hours in billing entries involving multiple counsel billing for reading, reviewing, drafting, and revising the same motions and documents.  At the $300 hourly rate, these duplicative billings account for $19,830.  While proofreading and reworking are an important aspect of diligent lawyering, such diligence must be reasonable under §506 given the circumstances.  The Court also noted a large number of examples of billling in the five separate loan files for the exact same entry, in the amount of 335.7 hours.  The court had insufficient evidence of whether these multiple-file entries were a fair allocation of reasonable time spread over multiple client files or was n improper multiplication of an otherwise reasonable single time entry.  The Court found that counsel in fact obtained excellent results for Farm Credit, preserving the client's oversecured position, but made now showing that its positions or arguments preserved estate property in any meaningful way.  There was no showing of similar cases where similar amounts of fees were charged, though this was likely a unique case.  Debtor's fees for all matters in the case are anticipated to be about $160,000, thus warranting some adjustment of the Farm Credit application.  The Court concluded that a 30% reduction in total fees was appropriate considering all factors above given Farm Credit's failure to meet its burden of establishing that the full amount is reasonable under §506.  The court allowed $153,613.37, and disallowed $65,834.40 in Farm Credit's counsel's fees.1 In re White, 260 B.R. 870, 880 (B.A.P. 8th Cir. 2001) (citing First W. Bank & Trust v. Drewes (In re Schriock Constr., Inc.), 104 F.3d 200, 201 (8th Cir. 1997)).↩2 In re Jointly Administered: Fansteel, Inc., 2017 Bankr. LEXIS 1265, at *8 (Bankr. S.D. Iowa May 9, 2017).↩Michael BarnettMichael Barnett, PA506 N Armenia Ave.Tampa, FL 33609-1703813 870-3100https://hillsboroughbankruptcy.com  

Frequent Mistakes that Could Put Your Social Security at Risk Your social security is an important asset that you can help support you after you retire – or after you have finished working due to disability. But social security rarely pays enough for you to meet all your expenses. And if something unexpected comes up, you may not have the money you need. You may find yourself in trouble with debt at some point, and you may be relying on your social security income to provide basic support. However, if your debt problems get to the point that your creditors are trying to garnish your bank account, your social security might be at risk. You may be able to file for bankruptcy to stop the garnishment, but if you don’t take preventive measures or don’t act quickly enough, you may not be able to protect some of that social security income. Here are frequent mistakes that could put your social security at risk: Putting Your Social Security into a Bank Account with Other Funds You likely deposit your social security funds into the same bank account that you use for all your money. Social security is a protected source of income. So, if your creditors get a judgement allowing them to garnish your bank account or wages, they are not supposed to be able to take your social security income. The trouble is that if you have been putting your social security into the same account as your other money, there’s no way to prove what money is social security and what money is from other sources. The only thing you can do to protect your money is to put it into a dedicated account. If the only money you are putting into one account is social security money, there can be no question about its source, and it will be protected. You can work with a Gilbert bankruptcy attorney to put a stop to the garnishment, but the best preventive measure you can take to protect your social security is to keep it in a dedicated account. Not Direct Depositing Your Social Security One way you can show how much social security has gone into the account is by setting up direct deposit. Then you will have an electronic record of every amount that has gone into the account and when it hit the account. Setting up direct deposit also protects up to two months of your social security income. The U.S. Treasury requires that banks protect up to two months of deposits from levies and garnishments. Therefore, even if you respond quickly to the original Writ of Garnishment and the creditors still try to seize funds, you will have some protection under federal law. Solutions through Bankruptcy Of course, the best protection against garnishment of your bank accounts and wages by creditors is to talk with a bankruptcy attorney in Mesa about your options for debt relief under Chapter 7 bankruptcy and Chapter 13 bankruptcy. Filing for bankruptcy will issue an automatic stay, which will put an immediate halt to any collection activity or legal proceedings. That doesn’t mean that your creditors will never be able to seize your assets, but it does mean that you’ll be given time to explore your options through bankruptcy. You may be able to file for Chapter 7 bankruptcy and have all of your unsecured debts discharged, or you may be able to restructure your debt under a Chapter 13 bankruptcy debt repayment plan. Your Gilbert bankruptcy attorney will help you understand how each option would benefit you best, dependent on your financial circumstances, such as what kind of debt you owe and how much income you have. Call My AZ Lawyers to learn more about the bankruptcy process and how it may help you get out from under overwhelming debt. Our bankruptcy lawyers will review your finances and talk to you about your goals to help you determine the best course of action. We may be able to help you put an end to garnishments, stop foreclosure, and more. Our bankruptcy law office serves clients throughout Mesa, Glendale, Tucson, and Phoenix. Call us today to schedule a consultation with a bankruptcy lawyer and explore your options for debt relief. Arizona Offices: Mesa Location: 1731 West Baseline Rd., Suite #100 Mesa, AZ 85202 Office: (480) 448-9800 Email: [email protected] Website: https://myazlawyers.com/ Glendale Location: 20325 N 51st Avenue Suite #134, Building 5 Glendale, AZ 85308 Office: (602) 509-0955 Tucson Location: 2 East Congress St., Suite #900-6A Tucson, AZ 85701 Office: (520) 441-1450 Avondale Location: 12725 W. Indian School Rd., Ste E, #101 Avondale, AZ 85392 Office: (623) 469-6603 The post Frequent Mistakes that Could Put Your Social Security at Risk appeared first on My AZ Lawyers.

Frequent Mistakes that Could Put Your Social Security at Risk Your social security is an important asset that you can help support you after you retire – or after you have finished working due to disability. But social security rarely pays enough for you to meet all your expenses. And if something unexpected comes up, you may not have the money you need. You may find yourself in trouble with debt at some point, and you may be relying on your social security income to provide basic support. However, if your debt problems get to the point that your creditors are trying to garnish your bank account, your social security might be at risk. You may be able to file for bankruptcy to stop the garnishment, but if you don’t take preventive measures or don’t act quickly enough, you may not be able to protect some of that social security income. Here are frequent mistakes that could put your social security at risk: Putting Your Social Security into a Bank Account with Other Funds You likely deposit your social security funds into the same bank account that you use for all your money. Social security is a protected source of income. So, if your creditors get a judgement allowing them to garnish your bank account or wages, they are not supposed to be able to take your social security income. The trouble is that if you have been putting your social security into the same account as your other money, there’s no way to prove what money is social security and what money is from other sources. The only thing you can do to protect your money is to put it into a dedicated account. If the only money you are putting into one account is social security money, there can be no question about its source, and it will be protected. You can work with a Gilbert bankruptcy attorney to put a stop to the garnishment, but the best preventive measure you can take to protect your social security is to keep it in a dedicated account. Not Direct Depositing Your Social Security One way you can show how much social security has gone into the account is by setting up direct deposit. Then you will have an electronic record of every amount that has gone into the account and when it hit the account. Setting up direct deposit also protects up to two months of your social security income. The U.S. Treasury requires that banks protect up to two months of deposits from levies and garnishments. Therefore, even if you respond quickly to the original Writ of Garnishment and the creditors still try to seize funds, you will have some protection under federal law. Solutions through Bankruptcy Of course, the best protection against garnishment of your bank accounts and wages by creditors is to talk with a bankruptcy attorney in Mesa about your options for debt relief under Chapter 7 bankruptcy and Chapter 13 bankruptcy. Filing for bankruptcy will issue an automatic stay, which will put an immediate halt to any collection activity or legal proceedings. That doesn’t mean that your creditors will never be able to seize your assets, but it does mean that you’ll be given time to explore your options through bankruptcy. You may be able to file for Chapter 7 bankruptcy and have all of your unsecured debts discharged, or you may be able to restructure your debt under a Chapter 13 bankruptcy debt repayment plan. Your Gilbert bankruptcy attorney will help you understand how each option would benefit you best, dependent on your financial circumstances, such as what kind of debt you owe and how much income you have. Call My AZ Lawyers to learn more about the bankruptcy process and how it may help you get out from under overwhelming debt. Our bankruptcy lawyers will review your finances and talk to you about your goals to help you determine the best course of action. We may be able to help you put an end to garnishments, stop foreclosure, and more. Our bankruptcy law office serves clients throughout Mesa, Glendale, Tucson, and Phoenix. Call us today to schedule a consultation with a bankruptcy lawyer and explore your options for debt relief. Arizona Offices: Mesa Location: 1731 West Baseline Rd., Suite #100 Mesa, AZ 85202 Office: (480) 448-9800 Email: [email protected] Website: https://myazlawyers.com/ Glendale Location: 20325 N 51st Avenue Suite #134, Building 5 Glendale, AZ 85308 Office: (602) 509-0955 Tucson Location: 2 East Congress St., Suite #900-6A Tucson, AZ 85701 Office: (520) 441-1450 Avondale Location: 12725 W. Indian School Rd., Ste E, #101 Avondale, AZ 85392 Office: (623) 469-6603 The post Frequent Mistakes that Could Put Your Social Security at Risk appeared first on My AZ Lawyers.

Businesses across the country have shut down due to COVID-19. People who were experiencing financial hardships are continuing to do so. Income has been reduced while bills continue to pile up. Many New Jersey individuals suffering under economic strain who were thinking about filing for bankruptcy or who were preparing for filing might be concerned […] The post Can I File for Bankruptcy in New Jersey because of COVID-19? appeared first on .

      At Shenwick & Associates, we are receiving many calls and emails these days from clients regarding leases which they would like to terminate and the principals' exposure for guarantees and good guy guarantees associated with those leases.Most commercial tenants in New York City are organized as either corporations or LL Cs and those entities are the tenant on the commercial office lease. Almost all landlords in New York City will require a principal or principal’s of the corporation or LLC to guarantee the lease.There are two types of lease guarantees in New York. A full or complete guarantee for the payment of rent or a “good guy guarantee (“GGG”)”, which is a specialized type of guarantee, which can limit the payment of the guarantor under the lease, if certain conditions enumerated in the GGG are met. Under the full or complete guarantee, for example if the tenant fails to make lease payments for 6 months and owes $50,000 for rent and additional rent under the lease, the Landlord can demand that the guarantor pay those monies and if payment is not made, the Landlord can sue the guarantor for $50,000. The second type of guarantee which is known as a good guy guaranty limits the principal’s exposure under the guarantee if certain conditions are met. To be a “good guy” means that the tenant vacates the space and delivers possession to the Landlord without litigation. An example of how GGG operates is provided below. The GGG provides that the principal’s financial exposure under the GGG terminates when: 1. the tenants sends notice to the Landlord that it is vacating the leased space (the usual notice required is 90 to 120 days), 2. the tenant must be current on its payment of rent and additional rent, when it sends the notice to the Landlord or current on rent when it vacates the space, 3.the space must be left “broom clean” and 4. keys for the office must be delivered to the Landlord. Under this scenario, if all 4 conditions are satisfied, the guarantor is released from liability under the Lease. However, if the 4 conditions are not satisfied the guarantor’s liability continues until the lease expires. If the tenant is unable to pay the rent due under the lease when it vacates the principal will often pay the rent for the tenant to terminate the GGG. It should be noted that just because the tenant vacated the space, the lease is not terminated and the tenant remains liable for rent until the lease terminates. If the tenant does not pay the rent, the landlord can sue the tenant but not the guarantor.Under that scenario, the tenant will either close its business or file for chapter 7 bankruptcy. As can be seen from the above examples, a GGG is a more limited form of guarantee. The statute of limitations for a landlord to commence an action under a guaranty under New York State law is 6 years. CPLR 213(2)Under New York custom and practice, the guarantee whether it is a regular guarantee or a GGG can be incorporated into the lease or it can be a separate document. Under certain limited circumstances based on a NYC administrative law, certain guarantees are void see New York City Administrative Code §22-1005, which provides for the suspension of certain contractual obligations between March 7 and Sept. 30, 2020. The law is applicable to leases for restaurants, bars, retail establishments and other similar non-essential businesses that were required to cease operations due to various COVID-19-related executive orders issued by the Governor. If a guarantor can avail themselves of that law, then the guarantor may be able to avoid liability even if the tenant does not pay rent under the lease. From a landlord’s perspective once they obtain possession of their space, they need to determine based on cost benefit analysis if they want to sue the tenant or the guarantor for rent that is due and owing. The landlord will consider the cost of litigation (legal fees and court costs) and the ability to collect on a judgment, if one is obtained. Due to the covid virus, many Landlords are taking a wait and see attitude and not commencing lawsuits immediately, as they may have in the past. A tenant that wished to vacate a lease should have the lease and the guarantee reviewed by an experienced attorney and the tenant and guarantor need to develop a strategy to deal with the landlord. Any clients having questions regarding a terminating a lease or with respect to a guarantee or good guy guarantees should contact Jim Shenwick at 212-541-6224 or email him at [email protected]. Jim Shenwick negotiates commercial leases, practices debtor creditor law and bankruptcy law.

Chapter 13 Trustee Thomas Gorman Thomas Gorman is a lawyer. He’s the Chapter 13 Trustee for the Alexandria VA Division of the US Bankruptcy Court. That’s a full time job. He was appointed in 2009. He runs your Chapter 13 bankruptcy hearing, called the “meeting of creditors.” Creditors hardly ever attend the meeting of creditors. […] The post Chapter 13 Trustee Thomas Gorman by Robert Weed appeared first on Northern VA Bankruptcy Lawyer Robert Weed.

If you are considering filing for bankruptcy, you should hire an experienced bankruptcy lawyer to help you manage the process. Bankruptcy laws are incredibly complex. A lawyer will make declaring bankruptcy easier, faster, and more successful. Although you are allowed to file for bankruptcy yourself, it is often an expensive mistake. In this article, you will learn ten reasons why you should hire a bankruptcy lawyer. 10 Benefits of Hiring a Bankruptcy Lawyer 1) Hiring a lawyer increases your chances of successfully eliminating debt. An annual report published by the United States Bankruptcy Court for the Central District of California shows that individuals representing themselves (pro se) have a significantly lower bankruptcy success rate than individuals represented by a lawyer. In the case of Chapter 13 Bankruptcy, debtors represented by a lawyer are more than ten times more likely to reach a successful outcome than individuals representing themselves. 2) A lawyer can help you decide if bankruptcy is the right option for you. It is essential to evaluate and understand all of the options available to you when you are facing overwhelming debt. While it may seem like bankruptcy is your only choice, a lawyer may have a better solution for managing your debt without declaring bankruptcy. 3) You don’t know which bankruptcy option is best for your situation. An experienced bankruptcy lawyer will review your financial situation and explain your bankruptcy options. In Wisconsin, the two most common types of personal bankruptcy are a Chapter 7 Bankruptcy and a Chapter 13 Bankruptcy. Wynn at Law, LLC’s lawyers can help you identify which type best fits your current situation and guide you through the entire process.  4) A bankruptcy lawyer will help eliminate all eligible debts. A bankruptcy lawyer will know which debts can be discharged and the best type of bankruptcy to use to discharge your debt. For example, a lawyer can identify and eliminate debts beyond the statute of limitations for collections. You will also save money by fully discharging your obligations and not having lingering debts after completing your bankruptcy.  5) Experience is crucial to success. Do you know the U.S. Bankruptcy Code? Do you know Wisconsin District Courts’ bankruptcy laws? Do you know what property is exempt from bankruptcy? Filing for bankruptcy requires knowledge of the federal code and local case law. An experienced bankruptcy lawyer has worked on hundreds of cases and understands the intricate details of the process. A bankruptcy lawyer will be familiar with current laws, courtroom procedures, the bankruptcy filing process, and filing timeframes. 6) Hiring a lawyer saves you time. Hiring a lawyer saves you countless hours, as you no longer have to spend your time researching and reviewing bankruptcy information. In some cases, a lawyer can identify shortcuts and smooth out the scheduling process. Wynn at Law, LLC’s bankruptcy lawyers will guide you through the complicated procedures and keep you informed at every stage.  7) You don’t have to handle the paperwork. Filing for bankruptcy requires accurate, detailed, and timely paperwork. It is crucial to have precise information and sufficient supporting documentation. While much of the information will come from you, a lawyer can help you complete the paperwork and provide legal advice on your disclosures, valuing assets, income, and expenses. 8) Lawyers have an established relationship with the bankruptcy court, judges, and trustees. A bankruptcy lawyer has gone through this before; they are familiar with bankruptcy courtroom etiquette. Lawyers have already built relationships with the people involved in the process, making communication easier for you. When the trustee asks for additional information or details, your bankruptcy lawyer will be prepared. 9) You get protection from harassment by creditors and collection agencies. Once you hire a bankruptcy lawyer, harassing phone calls from creditors will stop. Once a lawyer represents you, you can inform creditors or debt collectors and force their phone calls and letters to go through your lawyer instead. After you officially file, an automatic stay will be granted, which legally extends your harassment relief. 10) Lawyers offer you peace of mind and protection from uncertainty. Peace of mind goes a long way. You won’t have to worry about mistakes, losing your assets, or preparing for a court appearance. Your bankruptcy lawyer will advise you on what will happen ahead of time, complete your paperwork correctly, and sit by your side in creditor meetings or court. It is your lawyer’s responsibility to fight for the best outcome for you and protect your rights. Do I Need a Bankruptcy Lawyer? The logistics of bankruptcy paperwork, credit reporting bureaucracy, and collection agencies’ tactics can be challenging to manage without a lawyer. While you do not need a lawyer to file for bankruptcy – it is strongly recommended.  Are you still considering filing without an attorney, even after reviewing the list of reasons you should hire a bankruptcy lawyer? If so, you should understand some of the risks of representing yourself (pro se representation) when filing for bankruptcy. The Risks of Filing Bankruptcy Without a Bankruptcy Lawyer One little mistake could cost you everything. If you file incorrectly or the filing is incomplete, the bankruptcy judge could throw out your case. If that happens, you may not be able to refile for any type of bankruptcy in the near future or if you can refile, you may lose protection from creditors taking action against you. Incorrectly listing assets could cost you not only your debt being discharged, but you could lose the possessions you sought to protect. Bankruptcy lawyers know how to protect your assets and successfully lead you through the process. Mistakes could mean criminal charges for fraud or perjury. Committing fraud in a bankruptcy case can land you in jail. You cannot hide assets or income from the bankruptcy trustee or judge (even those that you haven’t received yet). Do you know the law well enough to avoid this serious situation? Did you sign over a vehicle, deed property, gift money, or other assets to a friend or relative? A bankruptcy lawyer will help you file your petition and truthfully list your assets in a way that protects you from criminal charges.  You may end up paying more of your debt. When communications between the bankruptcy trustee and your creditors occur, can you respond without negatively impacting your bankruptcy discharge? If a creditor files a lawsuit or contests your discharge of debt – how will you respond? A bankruptcy lawyer can protect your interests, effectively communicate with all parties involved, and save you money in negotiating with creditors. Get a Free Consultation with a Wisconsin Bankruptcy Lawyer Meeting with a bankruptcy lawyer in the early stages of financial difficulty can allow you to explore all of your debt relief options. If you can’t make regular payments on your existing debt, filing for bankruptcy may be a solution. Wynn at Law, LLC’s lawyers will meet with you to discuss your financial situation and help you determine if bankruptcy is right for you. Contact Wynn at Law, LLC for a free bankruptcy consultation: 262-725-0175 Wynn at Law, LLC has law offices in Lake Geneva, WI, Delavan, WI, and Salem Lakes, WI. Our lawyers provide legal advice and representation to residents throughout Southeastern Wisconsin. We are a debt relief agency that can help individuals or couples file for bankruptcy relief under the U.S. Bankruptcy Code. Filing for bankruptcy is an intricate legal process. The federal court in the Eastern District of Wisconsin oversees bankruptcy cases for residents of Walworth County, Racine County, and Kenosha County. The post Why Should I Hire a Bankruptcy Lawyer? appeared first on Wynn at Law, LLC.

In a recent mega-retail case, our client had outstanding, pre-petition purchase orders (“P Os”) for goods the debtor wanted delivered. It’s true that post petition suppliers have an administrative priority to get paid. However, that priority is meaningful only if there is cash available for payment. In this, as in most cases, lenders had liens on all of the debtor’s assets. The debtor got authority to use the banks’ cash collateral, subject to a budget. However, the budget did not disclose whose sales got paid. It was possible, if the reorganization failed, that the client might not get paid for millions of more dollars in sales. This becomes particularly aggravating, as the post-petition delivery provides more collateral for the pre-petition lenders. What could be done to make sure the sale occurred with certain payment and not alienating the debtor or the anticipated purchaser of its assets? PO As Executory Contract Bankruptcy Code § 365 authorizes debtors in possession (“DI Ps”) to assume (keep) or reject “executory contracts.” Executory contracts are agreements where the obligation of both parties to the contract “are so far unperformed that failure of either to complete performance would constitute a material breach excusing the performance of the other.”[1] For a DIP to assume an executory contract, they must provide the contract’s counter-party with “adequate assurance of future performance under such contract.”[2] P Os are executory contracts.[3] Suppliers/vendors can ask the bankruptcy court to enter an order requiring the DIP to decide keep or reject the sales contemplated by P Os (a “365 Motion”)[4]. If the DIP rejects the P Os, the goods don’t get shipped and the supplier has a prepetition claim for its damages.[5] If the DIP assumes the P Os, the supplier can require “adequate assurance of future performance.” This could include COD payment, letters of credit, or the lenders explicitly authorizing the prompt payment after delivery. It’s simply making sure the supplier gets paid. The Tale’s Outcome It was one month into the case. The debtor didn’t indicate that it was going to do to give the client comfort. We prepared the motion. On the eve of filing the motion, the official creditors’ committee in the case negotiated assurances of payment for post-petition sales. We did not have to file the motion. The Take Away A creditors’ committee may act fast enough to protect suppliers receiving payment, without a 365 Motion. Absent such action, nervous pre-petition suppliers with outstanding purchase orders appear to have a vehicle to assure payment for post-petition deliveries. References 1 See, V. Countryman, Executory Contracts in Bankruptcy, Part 1, 57 Minn.L.Rev. 439, 460 (1973). Examples of executory contracts are A.) leases (If the rent’s not paid I’m evicted. If I’m not in the apartment, I no rent for the landlord); B.) employment contracts (No work / no pay. No pay / no work) 2 See 11 U.S.C. § 365(b)(1)( C ). 3 Purchase Orders with yet to be delivered goods are executory contracts. See, In re Harnischfeger Indus., Inc., 293 B.R. 650, 659 (Bankr. D. Del. 2003), In re TK Holdings Inc. 2018 WL 1306271, at *27 (Bankr. D. Del.), In re Collins & Aikman Corp., 384 B.R. 751, 762 (Bankr. E.D. Mich. 2008), In re JZ, LLC, 357 B.R. 816, 823 fn. 19 (Bankr. D. Idaho 2006), aff’d sub nom. In re JZ L.L.C., 371 B.R. 412 (B.A.P. 9th Cir. 2007), In re APF Indus., Inc., 118 B.R. 122, 123 (Bankr. M.D. Fla. 1990)(“ The executory contract sought to be assumed is a purchase order.”). 4 See, e.g., In re Hawker Beechcraft, Inc., 483 B.R. 424 (Bankr. S.D.N.Y. 2012)(Licensor of intellectual property used by DIP to manufacture, sell, and support aircraft sought to compel the DIP to assume or reject licensing agreement.), In re Dana Corp., 350 B.R. 144 (Bankr. S.D.N.Y. 2006)(DIP’s supplier moved to shorten time for debtors to assume or reject executory supply agreements). 5 This means the creditor gets “bankruptcy dollars” not whole dollars. Bankruptcy Dollars are what general unsecured creditors receive in bankruptcy cases for their allowed claims. They are a fraction of the debt. See, In re Drexel Burnham Lambert Grp., Inc., 138 B.R. 687, 711 (Bankr. S.D.N.Y. 1992).(“Tiny bankruptcy dollars”), In re SunEdison, Inc., 557 B.R. 303, 309 (Bankr. S.D.N.Y. 2016)(A creditor’s successful Bankruptcy Litigation would result in Bankruptcy Dollars”), In re Breitburn Energy Partners LP, 571 B.R. 59, 69 (Bankr. S.D.N.Y. 2017)(“. . .value of the claim in “bankruptcy dollars” is not worth the expense to either party of litigating it.”)   The post A Remedy For Nervous Post-Petition Suppliers appeared first on Wayne Greenwald, P.C..