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Roger
Roger, Attorney
Category: Bankruptcy Law
Satisfied Customers: 31016
Experience:  BV Rated by Martindale-Hubbell; SuperLawyer rating by Thompson-Reuters
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If a person files for bankruptcy and lists a company as an

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If a person files for bankruptcy and lists a company as an asset and that company is still in debt to a listed creditor and that creditor makes an offer to the courts and the courts issue a motion to sell and sets a hearing and no one shows up, what happens, does it typically default to the creditor because they were the party that was owed?
Hi - my name is XXXXX XXXXX I'm a Bankruptcy litigation attorney. Thanks for your question.

Yes, the creditor would be entitled to the proceeds.

IF the company is a creditor, it would have a right to the proceeds of the sale of the debtor's business interest up to the amount of the debt owed (which should be listed in the motion to sell).

Any remaining proceeds would be turned over to the trustee to distribute among unsecured creditors.
Customer: replied 3 years ago.

So a motion to sell is pretty much a guarantee that the asset (in this case the company listed in the motion to sell) is going to the creditor (which is an individual and former owner who is owed money) regardless of whether anyone showed up to the evidentuary hearing?

Basically yes. If no one showed up, that just means that the trustee nor any creditors have an objection to the motion. In that case, the creditor making the motion will get the relief requested.
Customer: replied 3 years ago.

Thank you for such a timely response and help. Bankruptcy is such a complicated not very easy to understand subject and your time is appreciated. One last question if I may, is the contingency of all this a physical appearance or by the interested parties representation? Or is that part not even a factor in the outcome of a case?

No problem - glad to help.

Whether an appearance is required is usually up to the judge. That said, MOST judges don't require an appearance by any party unless someone files a written response/objection to the motion. If no written objections are filed, the judge will just accept an order without requiring a hearing.
Customer: replied 3 years ago.

And any objections or otherwise would have been listed in the court documentation or public records related to the case then, right? I find no objections in the public records to the motion to sell.

That's right. Any objections would be listed on the court docket.
Roger and 3 other Bankruptcy Law Specialists are ready to help you
Customer: replied 3 years ago.

I think I understand the process now a little better and sure appreciate your time! Thank you!

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