Bankruptcy Court Questions
What is a Bankruptcy Court?A bankruptcy court is a court that deals with bankruptcy cases in the United States. The United States bankruptcy court has many laws and regulations that cover bankruptcy cases. Anyone filing for bankruptcy may have to appeal to the bankruptcy court. Not having enough information about how the bankruptcy court works can make it difficult for the common man when he/she files for bankruptcy. Given below are popular questions asked by individuals about the bankruptcy court.
When filing for the Proof of Claim in a Bankruptcy Court, should an Individual claim for the Net Amount or the Gross Amount?When filing for a proof of claim in a bankruptcy court, an individual may claim for the net amount that is owed to him/her and not the gross amount. If the individual is a franchisee of a franchiser who has filed for bankruptcy, then the franchisee fee would be considered a setoff and would be deducted if he/she claimed the gross amount.
Can an Individual Reopen a Case in a Bankruptcy Court if he/she did not file the Master Matrix?If an individual does not file the master matrix at first, he/she may file a motion in the bankruptcy court to reopen the bankruptcy case. He/she can point out to the court that there was a clerical mistake and that the master matrix was sent later. The individual may also point out to the court that none of the creditors have a problem with the case being reopened.
Can a Breach of Non Dischargeable Agreement be pursued in a Bankruptcy Court?A breach of a non dischargeable agreement may not be pursued in a bankruptcy court. A bankruptcy court may only decide whether a debt is non dischargeable or not. It may not enforce the payment of the debt. Hence, failure to make payments by a debtor needs to be pursued in a state court.
Can an Individual get the Proof of Claim, the Motion to Lift Auto Stay and the Notice of Motion Forms in the Bankruptcy Court?An individual may get the proof of claim, motion to lift auto stay and notice of motion forms from the clerk at the bankruptcy court.
Will a Bankruptcy Court Sell a Secured Creditor’s Assets if he/she wants it to be Sold?In most situations, a bankruptcy court may not initiate the sale of a secured creditor’s property unless it benefits the unsecured creditor. However, if the secured creditor wants to avoid the cost and time involved in a foreclosure, he/she may file a motion for relief from stay.
What is the Punishment for Fraud in a Bankruptcy Court?The punishment for bankruptcy fraud in a bankruptcy court is a sentence of up to 5 years in prison or a fine of $ 250,000 or both.
Can a Bankruptcy Court Garnish an Individual’s Retirement Funds to Repay Creditors in Bankruptcy?A bankruptcy court may not garnish an individual’s retirement fund to repay creditors in a bankruptcy. Retirement funds may be exempt in a bankruptcy. However, if the individual has any other source of income, it may be garnished by the bankruptcy court to repay the creditors.
Can an Individual Oppose a Trustee’s Decision to Convert or Dismiss a Chapter 7 Bankruptcy in a Bankruptcy Court?If an individual does not want a trustee to convert or dismiss a Chapter 7 bankruptcy, he/she may file a motion in the bankruptcy court to oppose this conversion. However, he/she may have to prove to the bankruptcy court that he/she can afford a chapter 13 bankruptcy.
Having enough knowledge of how the bankruptcy court works can make it easy for individuals who are filing for bankruptcy to understand its nuances. It will help individuals deal with trustees. It will give them information on how to oppose or question a trustee’s decision in a bankruptcy court.