The Significance of Closing an Asset Case

[justbroke]

Justbroke, I did the research on this after reading multiple posts that said "who cares about the closing, its just an admin function".

It is an admin function, but general, the Trustee will file the Final Report of No Distribution, which "abandons" the property of the Estate far before the closing. You'll see multiple posts about people getting almost simultaneous 341 Meeting concluded (just passed) and a No Distribution Report.

I am an asset case (tax return), I never received anything that abandoned the property....a notice that has to be sent to everyone in your matrix.

Until you get the Final Report or the Trustee specifically Abandons the property of the Estate... the automatic stay remains in place and the property remains the property of the Estate.

Based on everything I read, I thought I needed to research and post the facts and maybe help others understand the significance...it is tax time and the trustee's are looking for easy pickins.

I read an Attorney's blog the other day and it basically read that it's Hunting Season for Trustees. Specifically... hunting for tax refunds! They love this time of year!

I think in an asset case, you are waiting for the trustee's final report. (mine was filed on Feb 7).

Exactly. However, in a No Asset Case, you're also waiting for the Report of No Distribution and the Trustee excusing themselves and abandoning the property. This was a distinction that I never really noticed, but the caselaw is piling up. Mostly brought up by Stay violations.

[AngelinaCatHub]

Absolutely true! Many people have been in serious trouble for selling assets post-petition and pre-close where the Trustee had not abandoned the asset (or otherwise administered the asset). This is why I tell people to wait for the case to close, unless the Trustee abandons the asset (under 11 USC 554(a)).

However, you aren't without recourse. You could file a Motion to Compel Abandonment if it's really bothering you.

We got a notice of abandonment far before our close. It listed items abandoned as our house and real property (homestead), a junk car, several other hard to sell items I can't remember. It was a whole year later that we closed as we had to pay the overage on the assets we purchased back, and a preferential payment levy. The Trustee and his lawyer were very good to us though under the amount of ignorance we had and the mistakes made that could have had our ears pinned back. 'Hub

[backtoschool]

I think in an asset case, you are waiting for the trustee's final report. (mine was filed on Feb 7). In the final report the trustee lists all the assets, bills for his/her fee, and assigns a payout schedule to the creditors. From what I can tell, the creditor's have 21 days to object to their payout amount and then the case closes.

[dspii]

Justbroke, I did the research on this after reading multiple posts that said "who cares about the closing, its just an admin function". I am an asset case (tax return), I never received anything that abandoned the property....a notice that has to be sent to everyone in your matrix.

Based on everything I read, I thought I needed to research and post the facts and maybe help others understand the significance...it is tax time and the trustee's are looking for easy pickins.

[justbroke]

So, does this mean that even if my case is discharged if they keep it open that the car company cannot repo my car unless they get permission from the court?

Yes, that's exactly what it means. The Stay remains in place until the asset is abandoned by the Trustee or the case is closed.

(I thought, myself, that the stay was automatically lifted after discharge. This is true, but only to those things abandoned by the Bankruptcy Estate. So unless the Trustee has published a "No Distribution" Report by discharge, the Stay remains in affect for all assets not Abandoned by the Trustee! Of course, this was a circuit court ruling that I read recently. It may not be caselaw everywhere, but it makes perfect sense to me!)

[tdawg]

So, does this mean that even if my case is discharged if they keep it open that the car company cannot repo my car unless they get permission from the court?

[justbroke]

Bottom line, in most asset cases, you legally cannot dispose of any assets listed on your schedules until your case is closed.

Absolutely true! Many people have been in serious trouble for selling assets post-petition and pre-close where the Trustee had not abandoned the asset (or otherwise administered the asset). This is why I tell people to wait for the case to close, unless the Trustee abandons the asset (under 11 USC 554(a)).

However, you aren't without recourse. You could file a Motion to Compel Abandonment if it's really bothering you.

[dspii]