Results 1 to 10 of 10
  1. #1
    Join Date
    Feb 2013
    Posts
    10

    Default Several Creditors Are Omitted in the Bankruptcy Petition

    My question involves bankruptcy in the state of: California

    I and several other creditors are omitted in the debtor's bankruptcy petition. Our debts range from $2K to $5K.
    I tried to contact the trustee, the US. Trustee. Program and the debtor's attorney on that issue, but got no reply.
    What else can be done?

    The debtor's business was an internet store, however before filing bk, he had deleted all online reports, invoices, data etc. So there may be even more affected creditors who are omitted in the bk petition.

  2. #2
    Join Date
    Apr 2009
    Location
    Somewhere near Canada
    Posts
    35,894

    Default Re: Several Creditors Are Omitted in the Bankruptcy Petition

    Is the debtor filing a no asset Chapter 7?

  3. #3
    Join Date
    Feb 2013
    Posts
    10

    Default Re: Several Creditors Are Omitted in the Bankruptcy Petition

    The debtor filed it as a no-asset, but now PACER shows it to be "asset case"

  4. #4
    Join Date
    Apr 2009
    Location
    Somewhere near Canada
    Posts
    35,894

    Default Re: Several Creditors Are Omitted in the Bankruptcy Petition

    You probably need to attend (either in person or by representation) the 341 meeting and state your claim.

  5. #5
    Join Date
    Feb 2013
    Posts
    10

    Default Re: Several Creditors Are Omitted in the Bankruptcy Petition

    That meeting is already over. Because we were not in the creditor list we did not get any notices about the bankruptcy and found out everything a bit late.
    If we were late for the 341 meeting, does it mean we are screwed?

    Is "omitting creditors in the petition" a bankruptcy fraud or any other violation? In fact, the debtor concealed several debts amounting to at least $17K . If yes, what's the best way to report it?

  6. #6
    Join Date
    Apr 2009
    Location
    Somewhere near Canada
    Posts
    35,894

    Default Re: Several Creditors Are Omitted in the Bankruptcy Petition

    Is the bk closed yet? How late are we talking?

  7. #7
    Join Date
    Feb 2013
    Posts
    10

    Default Re: Several Creditors Are Omitted in the Bankruptcy Petition

    the bk is not closed yet, it was filed 5 months ago. We missed 341 meeting and we missed the deadline to file proof of claims (because as I have already said we have not been notified in any way about this bk). We have all supporting documents - invoices, payment and sales reports etc

    But even if it is too late to prove our debt, I'd like to at least report the violation. Omitting several creditors should not be considered "in good faith"

  8. #8
    Join Date
    Apr 2009
    Location
    Somewhere near Canada
    Posts
    35,894

    Default Re: Several Creditors Are Omitted in the Bankruptcy Petition

    Keep contacting the Trustee. It's not closed yet, and you appear (at least from what you've written here) to have a valid complaint.

    If it turns out though that your debtor is a no asset Ch 7, you'll be out of luck.

  9. #9
    Join Date
    Sep 2010
    Posts
    478

    Default Re: Several Creditors Are Omitted in the Bankruptcy Petition

    Is this a corporate (Inc. or LLC) case or an individual case?

    If a corporate case there is no discharge so once the case is closed you would be free to attempt to collect from the entity. However, since, in theory, all of the entity’s assets would have been liquidated by the Trustee, and assuming the entity is no longer operating, attempt to collect would be a waste of time.

    If this is an individual filing, per 11 USC 523(a)(3) the obligation to you would not be subject to the discharge if you were not listed in time to permit you to file a timely proof of claim, unless you had notice or actual knowledge of the bk in time to file the claim but failed to do so.

    In either case you can file a Motion to allow a late filed claim. If the Court grants the Motion your claim will be deemed as “timely” and you can participate with other timely claims in any distribution. However, if the motion is granted and this is an individual case, the claim will be subject to the discharge.

    Lastly, you should get the claim on file even if you decide not to ask that it be deemed timely. On the off chance that the assets are sufficient to pay all timely claims in full, before any funds are returned to the Debtor, the Trustee will pay untimely claims.

    As to the failure to list, this happens all the time, hence the reason the bk Code has provisions addressing the problem. Is the failure to list a “fraud upon the court”? Usually not, especially in business cases where there are hundreds, if not thousands, of potential creditors.

    Des.

  10. #10
    Join Date
    Feb 2013
    Posts
    10

    Default Re: Several Creditors Are Omitted in the Bankruptcy Petition

    Des.
    This is an INC. bankruptcy.
    Thank you very much for your very detailed instruction!

    1. Sponsored Links
       

Similar Threads

  1. Chapter 7: Can Creditors Really Stop Me from Filing Bankruptcy
    By Kneegroyd in forum Bankruptcy Law
    Replies: 2
    Last Post: 02-06-2012, 06:35 PM
  2. Chapter 7: How Are Creditors Notified That Your Bankruptcy Has Been Discharged
    By sunny_california in forum Bankruptcy Law
    Replies: 2
    Last Post: 10-29-2010, 07:49 PM
  3. Chapter 7: Forgotten Creditors in Bankruptcy
    By Lilacs in forum Bankruptcy Law
    Replies: 1
    Last Post: 08-03-2010, 07:49 AM
  4. Bankruptcy Issues: Bankruptcy and Creditors
    By farmer in forum Bankruptcy Law
    Replies: 2
    Last Post: 02-11-2009, 09:56 PM
  5. Chapter 7: Lawyer Omitted Creditors From Chapter 7 Filing
    By crmauro in forum Bankruptcy Law
    Replies: 1
    Last Post: 09-18-2007, 07:02 AM
 
 
Sponsored Links

Legal Help, Information and Resources