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BUL Exam 3 CH.39
Bankruptcy
45
Law
Not Applicable
11/14/2012

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Term
Chapter 7: Liquidation
Definition
applies to individuals or businesses
Term
Chapter 11: Reorganization
Definition
applies to most businesses
Term
Chapter 12: Wage Earner Plan
Definition
applies to individuals
Term
Chapter 13: Joint Filings
Definition
Spouses may file proceedings together under 7 or 13
Term
*Commencement of the Case
Definition
the filing of a petition begins jurisdiction in the bankruptcy court.
Term
Voluntary Petitions
Definition
available to any debtor even if solvent; consumer debtor must receive credit counseling before filing.
Term
Involuntary Petitions
Definition
may be filed only under Chapter 7 or 11 if the debtor is generally not paying his debts as they become due; debtor may answer the petition.
Term
Chapter 12: Reorganization
Definition
Applies to family farms
Term
(1)Petitions Must Include the Following Information:
Definition
Identification of the debtor (including related entities)
Term
(2)Petitions Must Include the Following Information:
Definition
Schedules of assets
Term
(3)Petitions Must Include the Following Information:
Definition
Schedules of debts
Term
(4)Petitions Must Include the Following Information:
Definition
Identification of creditors (persons or entities to whom the debts are owed)
Term
Failure To Disclose This Information May Result in
Definition
No or Incomplete Relief
*Dismissal or Conversion
Term
Dismissal
Definition
the court may dismiss a case for cause after notice and a hearing.
Term
Conversion
Definition
a Chapter 7 case may be converted to a Chapter 11 or 13 case in certain circumstances.
Term
*Automatic Stay
Definition
upon the filing of a petition and giving notice in other proceedings, it prevents attempts by creditors to recover on claims outside of the bankruptcy court; freezes even pending litigation in state courts;
Term
Notice to Creditors
Definition
if assets exist, creditors given opportunity to file claim.
Term
*Meeting of Creditors (a/k/a § 341 Meeting)
Definition
debtor must appear and submit to an examination of her financial situation.
Term
*Creditor
Definition
any entity that has a claim against the debtor.
Term
*Claim
Definition
a right to payment.
Term
Priority of Claims
Definition
the right of certain claims to be paid before claims of lesser rank.
Term
*Domestic support obligations
Definition
Term
*Expenses of administration of debtor’s estate
Definition
Term
*Gap creditors (incurred between filing of claim and order for relief)
Definition
Up to $10,000 for wages, salaries or commissions
Contributions to employee benefit plans
Up to $4,925 for grain or fish producers against a storage facility
Up to $2,225 for consumer deposits
Term
*Taxes
Definition
Claims arising from DUI convictions
Term
*Discharge
Definition
relief from liability for all debts except those the Bankruptcy Code specifies as not dischargeable.
Term
*Estate
Definition
When a bankruptcy case is filed, all legal and equitable interests of the debtor in nonexempt property become property of the “estate.”
Term
*The Trustee
Definition
a third party that supervises the bankruptcy case and can control disposition of assets
Term
Voidable Preferences
Definition
Bankruptcy Code invalidates certain preferential transfers made before the date of bankruptcy from the debtor to favored creditors.
Term
Fraudulent Transfers
Definition
*Trustee may avoid “fraudulent” transfers made on or within one year before the date of bankruptcy.
Term
*Liquidation
Definition
involves terminating the business of the debtor (if applicable), distributing his nonexempt assets, and, discharging all dischargeable debts.
Term
means test
Definition
Abuse may be found if the debtor filed in bad faith or if the debtor’s income is greater than the state median income
Term
(1) Distribution of Estate
Definition
secured creditors
Term
(2) Distribution of Estate
Definition
creditors entitled to a priority
Term
(3) Distribution of Estate
Definition
unsecured creditors
Term
(4) Distribution of Estate
Definition
fines & interest
Term
(5) Distribution of Estate
Definition
the debtor
Term
Discharge
Definition
granted unless the debtor has committed an offense under the Bankruptcy Code or has received a discharge within past eight years.
Term
Purpose
Definition
to preserve a distressed entity and its value as a going concern.
Term
(1)Confirmation of Plan requires
Definition
(1) good faith
Term
(2)Confirmation of Plan requires
Definition
(2) that the value of property distributed to creditors be not less than the amount to be paid them under Chapter 7
Term
(3)Confirmation of Plan requires
Definition
(3) that secured creditors accept the plan
Term
(4)Confirmation of Plan requires
Definition
(4) that the debtor be able to make all payments and comply with the plan.
Term
*Extension agreement
Definition
gives the debtor more time to pay, either in full or reduced.
Term
*Assignment for Benefit of Creditors
Definition
voluntary transfer by the debtor of some or all of his property to a trustee, who applies the property to the payment of all the debtor's debts
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