Bankruptcy Tutor
Where to turn for information on filing a business bankruptcy
By Ron Sokol
Question: How do I go about filing a bankruptcy for my business? I want to get rid of the debts. Can you recommend a good resource for me to get up to speed on what I have to do?
-- C.W.,
El Segundo
Answer: A bankruptcy case requires the filing of a petition with the bankruptcy court. A court fee usually is required at the time of filing.
In addition, a statement of assets and liabilities, and a schedule listing all creditors, is to be filed (typically within a set time frame after the bankruptcy petition is filed, or the bankruptcy is subject to dismissal).
There are different kinds of bankruptcies. It sounds like you are interested in having your business file a straight liquidation bankruptcy, which is referred to as a "Chapter 7." This is where the filing party seeks to discharge (ie, extinguish) his or the company's debts.
An alternative is a reorganization bankruptcy, known as a "Chapter 11," where the party's effort is develop a plan to compromise debts, work things out with creditors to the extent feasible, and return to non-bankruptcy status.
A third version is a Chapter 13 bankruptcy, known as an individual wage earner filing. But that does not appear to be what you have in mind.
I found a detailed, helpful booklet published by the Federal Courts titled "Bankruptcy Basics". Go to www.uscourts.gov, click onto "U.S. Bankruptcy Courts" and on that page in the left column click on "bankruptcy basics pdf." Among other things, you will read there that not all debts are dischargeable. For example, tax liens do not simply go away.
Thus, you may want to consult with a bankruptcy lawyer. The South Bay Bar Association has an excellent referral service at 310-543-9773.
Q: I am in the midst of a divorce proceeding. My wife has not worked for several years, but at one time was earning quite a bit of money (and still could). She stopped working shortly after the birth of our child. Is spousal support set without any consideration for what she could earn?
-- W.R.,
Rancho Palos Verdes
A: In evaluating spousal support payments, the court should take into consideration your spouse's earning capacity.
In fact, a vocational specialist can be appointed by the court to interview your spouse to make an evaluation of whether she is capable of working, and, if so, an approximation of what she can earn. Those findings likely will be taken into consideration by the court in establishing your spousal support obligations.
Thus, the sum you may be paying now may not be what the court sets as your monthly obligation when the divorce is finalized.
Complaints against attorneys
For those of you who have asked, the State Bar has an attorney complaint hotline at 800-843-9053. The State Bar Web site at www.calbar.org also has a specific section on lawyer discipline and complaints, with information on how to file a complaint.
By Ron Sokol
Question: How do I go about filing a bankruptcy for my business? I want to get rid of the debts. Can you recommend a good resource for me to get up to speed on what I have to do?
-- C.W.,
El Segundo
Answer: A bankruptcy case requires the filing of a petition with the bankruptcy court. A court fee usually is required at the time of filing.
In addition, a statement of assets and liabilities, and a schedule listing all creditors, is to be filed (typically within a set time frame after the bankruptcy petition is filed, or the bankruptcy is subject to dismissal).
There are different kinds of bankruptcies. It sounds like you are interested in having your business file a straight liquidation bankruptcy, which is referred to as a "Chapter 7." This is where the filing party seeks to discharge (ie, extinguish) his or the company's debts.
An alternative is a reorganization bankruptcy, known as a "Chapter 11," where the party's effort is develop a plan to compromise debts, work things out with creditors to the extent feasible, and return to non-bankruptcy status.
A third version is a Chapter 13 bankruptcy, known as an individual wage earner filing. But that does not appear to be what you have in mind.
I found a detailed, helpful booklet published by the Federal Courts titled "Bankruptcy Basics". Go to www.uscourts.gov, click onto "U.S. Bankruptcy Courts" and on that page in the left column click on "bankruptcy basics pdf." Among other things, you will read there that not all debts are dischargeable. For example, tax liens do not simply go away.
Thus, you may want to consult with a bankruptcy lawyer. The South Bay Bar Association has an excellent referral service at 310-543-9773.
Q: I am in the midst of a divorce proceeding. My wife has not worked for several years, but at one time was earning quite a bit of money (and still could). She stopped working shortly after the birth of our child. Is spousal support set without any consideration for what she could earn?
-- W.R.,
Rancho Palos Verdes
A: In evaluating spousal support payments, the court should take into consideration your spouse's earning capacity.
In fact, a vocational specialist can be appointed by the court to interview your spouse to make an evaluation of whether she is capable of working, and, if so, an approximation of what she can earn. Those findings likely will be taken into consideration by the court in establishing your spousal support obligations.
Thus, the sum you may be paying now may not be what the court sets as your monthly obligation when the divorce is finalized.
Complaints against attorneys
For those of you who have asked, the State Bar has an attorney complaint hotline at 800-843-9053. The State Bar Web site at www.calbar.org also has a specific section on lawyer discipline and complaints, with information on how to file a complaint.
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