QUESTION
Would it benefit us if we told the trustee via letter about the debtor's assets?
Asked on Feb 11th, 2013 on Bankruptcy - Florida
More details to this question:
In 2012, we obtained a judgment against a shoddy contractor who also harassed our family afterward. Just prior to trial, he threatened bankruptcy so we agreed to accept a nominal sum to be paid out monthly over several years. We just received notice that he has filed for Chapter 7 Bankruptcy and claimed no assets. However, until one week prior to this filing we know he owned large miscellaneous construction equipment, including a back hoe, as well as various boating equipment and snow mobiles. Would there be any benefit communicating this potential asset information in a letter to the Trustee?
13 ANSWERS
Bankruptcy Attorney serving Phoenix, AZ
at
Law Office of D. L. Drain, P.A.
Update Your Profile
Yes. Make sure to be specific, do not speculate. Send your letter to both the chapter 7 trustee and the US Trustee.
Answered on Feb 15th, 2013 at 6:20 AM
Bankruptcy Law Attorney serving Austin, TX
at
Law Office of Susan G. Taylor
Update Your Profile
Even if you are in a payment plan, his debt to you can still be discharged unless you agreed otherwise. Failing to disclose significant assets is the sort of fraud that could get him kicked out of bankruptcy with a bar to filing for a period of time.
Answered on Feb 14th, 2013 at 6:29 PM
Chapter 13 Bankruptcy Attorney serving Winston-Salem, NC
at
Love and Dillenbeck Law
Update Your Profile
Yes, if the trustee can sell these assets, he can distribute money to you and other creditors.
Answered on Feb 13th, 2013 at 4:17 AM
Business Bankruptcy Attorney serving Raleigh, NC
at
J.M. Cook, P.A.
Update Your Profile
You should communicate such knowledge to the trustee. However, you should realize that he may own many assets that have liens in excess of their value or could be owned by another entity.
Answered on Feb 13th, 2013 at 4:17 AM
Possibly. You will also want to file a claim in order to get your pro rata share of any funds gathered by the trustee. Telling him your concerns will certainly motivate him to look hard at the debtor.
Answered on Feb 13th, 2013 at 4:17 AM
You could inform the panel trustee, or better still, you could pass on the information to the office of the United States Trustee, which enforces bankruptcy laws. Be aware that the bankruptcy court has a liberal policy of permitting debtors to amend their pleadings, especially if the bankruptcy was filed in a hurry and without allowing the debtor or the attorney for the debtor to review the assets completely.
Answered on Feb 13th, 2013 at 4:15 AM
Bankruptcy Attorney serving Alpena, MI
at
Carl C. Silver Attorney at Law
Update Your Profile
If you inform the trustee about potential assets, you may make the contractor's life and bankruptcy quite miserable. Bear in mind that all the assets you saw may all be encumbered by loans. You should review the contractor's bankruptcy schedules to see if the assets you believe belong to him are listed or not. Whether your investigation will benefit you will depend on how much total unsecured debt the contractor has. If the trustee recovers money by selling assets of the debtor the money recovered will be distributed to all of the creditors that file a claim after receiving a notice to file a claim due to discovery of assets.
Answered on Feb 13th, 2013 at 4:15 AM
Chapter 13 Bankruptcy Attorney serving Bloomington, MN
at
Gregory J. Wald
Update Your Profile
If the debtor is hiding assets, they could possibly be liquidated to pay a dividend to creditors. The debtor might be denied a discharge of his debts and could even go to prison. However, it could be that he is just renting or borrowing equipment. Make sure that you have your facts right before you make any accusations.
Answered on Feb 13th, 2013 at 4:13 AM
Bankruptcy Attorney serving Overland Park, KS
at
Wellman Law LLC
Update Your Profile
The potential benefit would be if these were assets were liquidated and you filed a valid Proof of Claim you could receive a portion. There's a very good chance that equipment has a bank lien on it or was being rented. If you look through their schedule of assets and ongoing contracts it should appear somewhere.
Answered on Feb 13th, 2013 at 4:11 AM
Bankruptcy Attorney serving Walnut Creek, CA
at
Alan E. Ramos Law Offices
Update Your Profile
If the debtor did not list the assets and the trustee never finds out about them, the debtor will receive his discharge (with the debt to you being discharged) and the debtor will still have the assets. I would recommend that you notify the trustee about the assets. This will allow the trustee to investigate the assets and determine if they have value to the estate. If they do have value, the trustee can sell the assets and return some money to creditors.
Answered on Feb 13th, 2013 at 4:11 AM
Appellate Attorney serving Grosse Pointe Farms, MI
at
Musilli Brennan Associates, PLLC
Update Your Profile
Yes, especially if you are hoping to collect the settlement.
Answered on Feb 13th, 2013 at 4:10 AM
Yes, you could tell the trustee about the assets and it might mean a bigger recovery for all of the creditors. You should also file a proof of claim for the full amount you were owed.
Answered on Feb 13th, 2013 at 4:10 AM
It will depend on the trustee. However, you can also discuss filing a complaint against the debtor receiving a discharge with an attorney. If these assets were transferred within a certain period before the filing of the bankruptcy and the transfer was not disclosed, it can form the basis for the complaint.
Answered on Feb 13th, 2013 at 12:52 AM