Bankruptcy Supp.

Creditor liable for damages, attorney fees, and punitive damages.

Violation of Automatic Stay

Trustee gets rights of an actual creditor who may avoid a transfer under state law.

544 Fraudulent Transfers

Acceptance may not commence until after a disclosure statement has been approved by the court.

Acceptance of the Plan

Individuals with regular income and unsecured debts of less than $360,475 and secured debts of $1,081.400 are eligible for relief under chapter 13. -Commenced only by voluntary petition. -debtor remains in possession, has right to use, sell, or lease property. -trustee's main duty is to investigate into the financial affairs, examine claims, give debtor nonlegal advice, and make sure the appropriate child enforcement agency is notified.

Adjustment of Debts Under Chapter 13

Same provisions for adjustments of debts of a farmer or fisherman with regular income as Chapter 13.

Adjustment of Debts of Family Farmer with Regular Annual Income- Chapter 13

Individuals keep assets by paying off their debts in accordance with a plan approved by the Court. Permits debtor to propose a plan that extends and or reduces the balance of his obligations. Gives debtor the discharge , but only after all plan payments are made. Individuals with non-contingent, liquidated, unsecured debts of less than $360,475 and secured debts of less than $1,081,400 are eligible.

Adjustment of Debts of Individuals with Regular Income- Chapter 13

Ancillary proceeding that can be used by a foreign debtor who has a bankruptcy case pending in another country.

Ancillary Cases- Chapter 15

1. Interim trustee appointed promptly after order of relief entered. Performs all functions and duties until regular trustee is selected and qualified. Begins preliminary investigations. Selected by US Trustee from panel of private trustee. 2. Trustee- Creditors may elect a trustee at meeting of creditors, but only if election is requested and votes are cast by creditors who had at least 20 prevent. Interim trustee becomes Trustee w/o election. Trustee acts as rep of the bankruptcy estate. Collects, sells, and reduces to cash the assets of the estate; continues to operate debtor's business; and makes a final report and files a final account with the court and with the US Trustee. -Trustee reviews file and w/I 10 days after first creditors' meeting, file a statement as to whether there is a presumption of abuse.

Appointment of Trustee- Chapter

Attorney certifies that she has performed a reasonable investigation into the circumstances giving rise to the petition and that the petition is well grounded in fact and law and is not an abuse.

Attorney Signature on Chapter 7 Pleading

Prevents creditors from pursuing remedies against the debtor or his assets. Use of legal process to collect debts are stayed. Creditors are stayed from exercising right to offset claims that they have against debtor. -arises as son as petition for bankruptcy is filed *Does not alter substantive rights of creditors.

Automatic Stay

Earliest of the closing of the case, dismissal of the case, or in the case of an individual- when a discharge is granted or denied.

Automatic Stay Duration

Adopted by Congress. Bankruptcy Cts. cannot be granted broad jurisdiction. Only "core proceedings" central to the determination of a petition in bankruptcy.

Bankruptcy Code

Attorney certifies that the petition is not presented for an improper purpose, that its claims are warranted by law or a nonfrivolous argument for a change in the law, and the allegations have evidentiary support. -Court may order debtor attorney to reimburse the Trustee's reasonable cost in prosecuting a motion to dismiss if attorney violates rule

Bankruptcy Rule 9011

1. Filing petition in Bankruptcy Court. (usually debtor)

Commencing Bankruptcy Case

With 20 to 45 days after meeting of the creditors, if there is no objection, ct must hold a hearing to determine whether to confirm the debtor's plan. -if trustee or unsecured creditor objects, approval is not allowed unless: 1. value of the property to be distributed is at least equal to the amount of the claim; or 2. the plan provides that the debtor's entire disposable income to be received during the applicable commitment period will be applied to pay unsecured creditors.

Chapter 13 Confirmation

Debts are not discharged until the debtor has made all payments under the plan. at the time, as soon as is practicable, the court will grant discharge. -Does not discharge long-term debts.

Chapter 13 Discharge

-Debtor must commit all disposable income to the plan. 1. Must flile a debt adjustment plan with the petition or w/I 15 days after filing the petition. a) provide for submission to the trustee such portion of the debtor's future income as necessary b) provide for full payment, in deferred cash payments, of all priority claims; c) provide the same treatment for each claim within a class. 2. If current combined monthly income of the debtor and his spouse is atleast equal to the applicable state medium, plan my provide for payments for a period of up to five years. If combined total is less, payment period may not exceed three years.

Chapter 13 Plan

-vest title to all property of the estate in the debtor -binds debtor and all creditors to the terms of the plan and discharge all debts dischargeable under the Code.

Effect of Confirmation

Creditors commence case against a debtor. -12 or more creditors with non contingent claims: three or more creditors whose claims aggregate at least $14,425 must join the petition -Fewer than 12 creditors with non contingent claims: any 1 or more of such creditors whose claim aggregates atleast $14,425 may file the petition alone. Grounds: Debtor is generally not paying debts as they become due. Debtor regularly misses a significant number of payments to creditors.

Commencing Involuntary Case

If combined monthly income of debtor and spouse equals the state median income for similar size families, commitment period is 5 years. If income is less, period is 3 years.

Commitment Period- Chapter 13

Court must enter order confirming plan if: 1. Is accepted by all impaired class; 2. Provides for payment of all second priority administrative expenses and third priority involuntary gap period claims in cash on the day the plan becomes effective 3. Provides for payment in full in cash of first, fourth, fifth, and seventh priority claims on the effected date of the plan unless the class has accepted the plan; 4. Provides for regular cash installment payments of eighth priority tax claims 5. Provides for payment in full of al domestic support obligations that first become payable after the filing of the petition. 6. Provides in the case of individual debtor, that value of the property to be distributed to the holder of an allowed secured claim is at least equal to the amount of the claim or to the debtor's projected disposable income to be received during the longer of five years or the period which the plan provides payments. 7. Provides for payment in full of all bankruptcy fees 8. Is feasible *Order, confirming plan Is stayed 14 days after the order's entry.

Confirming Plan

Debtor may generally operate its business in the ordinary course without a court order. A trustee is usually not appointed. -Business Judgment Rule- must use reasonable judgment concerning the ordinary affairs of the business. -professionals employed by the debtor in possession must be disinterested persons and cannot hold or represent interest adverse to the estate.

Continued Operation of Business- Chapter 11

-voidable if made within 2 years before filing of petition 1. Transfers made with actual intent to hinder, delay, or defraud an entity to which the debtor was/become indebted. (Transfer to self-settled trust to which debtor is a beneficiary, made with intent to defraud a creditor, may be avoided by trustee if made w/I 10 years before petition) 2. Transfers for less than a reasonably equivalent value are fraudulent if: a) debtor was insolvent or became insolvent as a result; b) debtor was engaged in business with an unreasonably small amount of capital; c) debtor intended to incur debts that would be beyond the debtor's ability to pay; or d) debtor mad transfer to or for the benefit of an insider or incurred obligation, under an employment contract and not in the ordinary course of business. -certain charitable contribution excluded if not more than 15% of gross income or consistent with practices. 3. Transfers of Partnership Property may be avoided by Trustee if partnership was insolvent when transfer was made or became insolvent as a result.

Conveyances Fraudulent under 548

entitled to protection against property's decrease in value during the life of the automatic stay. Trustee may make periodic cash payments to compensate for depreciation in collateral, or give secured creditor a lien on other property to the extent of depreciation.

Creditor with Lien on Debtor's Property

-filed w/I 90 days of the first meeting of the creditors - Constitutes prima facie evidence of the validity and amount of the claim. If Trustee or other Creditor objects to allowance of a claim, ct must hold a hearing to determine whether it should be allowed. -Ct may allow claims for expenses incurred in connection with the administration of the estate (cost of preserving asssets;, services performed by trustee; tax obligations incurred; compensation for the trustee's attorney).

Creditors Proof of Claim

Agencies that are paid to provide bankruptcy assistance to an assisted person. 1. Must enter a written contract (services, fees, payment terms) with debtor within 5 business days after the first date on which the agency provides bankruptcy assistance and before filing a petition. 2. Advertising to the public must clearly disclose services involve bankruptcy, they are a debt relief agency. 3.May not advise people to incur more debt because he is filing for bankruptcy, rather than for valid purpose. Also may not file misleading/false documents, nor misrepresent services/benefits/risk. 4. Debt relief agency that breaches duties may be subject to actual damages, costs, loss of fees, and/or injunction.

Debt Relief Agencies:

Payment within the 90 days is not a preferences as long as the debtor did not give the creditor more than he would otherwise receive in liquidation case. If so the trustee can recover the differences for the benefit of the estate.

Debtor's Payment to Creditors with Valid Security Interest

-must be by an individual consumer debtor Means Test: If an individual's debtor current monthly income multiplied by 12 exceeds the annual median family income for families of similar size in debtor's home state, and after deducting living expenses, would be sufficient to allow debtor to pay back at least $11,725 in 5 years, presumption of abuse arises. Bad faith or totality of the circumstances test: showing debtor filed in bad faith or by establishing lack of good faith under the totality of the circumstances.

Dismissal of Chapter 7 Case where there is abuse

Current monthly income minus amounts necessary for maintenance of debtor or domestic support obligations, charitable contributions for up to %15 of gross income, and payments necessary to continue a business.

Disposable Income

1. List of creditors 2. Schedule of assets and liabilities 3. Schedule of current income and current expenditures 4. Statement of the debtor's financial affairs 5. Copies of pay stubs- received from employer w/I 60 before filing. 6. Itemized statement of monthly net income; 7. Statement disclosing any reasonably anticipated increase in income or expenditures for the 12 months after filing. 8. A record of any interest debtor has in an education individual retirement account or a qualified state tuition program 9. If debtor is an individual; a certificate from the nonprofit budget and credit counseling agency, along with any plan of repayment developed by the agency; and 10. If debtor is an individual and has debts secured by property- a statement of her intention with respect to the property (retain or surrender). *Must file claims within 45 days after filing petition or case may be dismissed.

Documents to be filed by Debtor when Bankruptcy Petition is filed

Establishes and supervises a panel of private trustees that are available to serve in liquidation cases. -US trustee maybe required to serve as a trustee himself. -Trustee supervises the administration of cases and trustees in Chapter 11 or 13 cases.

Duties of Trustees

1. Relieves a debtor of personal liability for any debts that are discharged; and 2. serves as a permanent injunction against creditors, prohibiting them from taking any action to recover a discharged debt. *discharged debt does not affect liability of co-debtor, surety, or guarantor

Effect of Discharge

1. A transfer of the debtor's interest in property 2. To or for the benefit of a creditor 3. For or on account of an antecedent debt 4. While the debtor was insolvent 5. Made within 90 days before the date of filing of the Bankruptcy Petition. 6. That enables the creditor to receive more than the creditor would receive in a bankruptcy liquidation.

Elements of a Voidable Preference

1. Prosecution of criminal cases 2. Cases brought to establish paternity or domestic support obligations; 3. Cases regarding child custody or visitation; or domestic violence 4. Cases seeking dissolution of marriage; except if property is property of bankruptcy estate. 5. Collection of a domestic support obligation 6. Reporting overdue child support obligations to a consumer reporting agency; 7. Taking steps to maintain perfection of an interest in property; 8. Assessment of tax or demand for tax returns, or a tax audit. 9. Enforcement of a security interest in real property if debtor is violating a previous bankruptcy ruling... 10. Eviction proceeding

Exceptions to Automatic Stay

1. Transfers in the ordinary course of business or financial affairs 2. Transfers intended as contemporaneous exchanges for new value- and in fact it was substantial contemporaneous. 3. Purchase Money Security Interest-to the extent that it secures new value (credit) that was given by the secured arty at or after the signing of a security agreement (describing property as collateral) if it is perfected w/I 30 days after the debtor receives possession of the collateral. 4. Subsequent Advances- creditor gives new unsecured advance to debtor. New value is subtracted from preference to arrive at net result. 5.Floating Liens- a security interest that attaches to after-acquired inventory or accounts receivable of the debtor. A security interest in inventory or accounts recievable is vulnerable as a preference only to the extent that the secured creditor's position is improved to the detriment of the estate during the 90-day period. 6. Statutory Liens 7. Domestic support Obligations 8. Transfers by Consumer Debtors- if the aggregate value of all property transferred is less than $600. If not primarily consumer debts, not voidable if value of property is less than $5,850. 9.Trahnsfers as Part of Allternative Repayment Schedule.

Exceptions to Trustee's Power to Avoid Preferences

Trustee has the power to assume reject, or assign an executory contract of the debtor upon approval of the bankruptcy court. 1. Rare in liquidation. Trustee job is to wind up the estate, not continue business. Trustee may assign if it will benefit the estate (can't assign personal service contracts). 2.Reorgonization/Debt Adjustment- Normal practice is for the trustee to perform executory contracts, reorganization continues business. Assignments are possible with approval from the courts. If contracts are burdensome using "business judgment" they will be terminated. -Trustee/debtor in possession must make timely payments under a lease of nonconsumer personal property from 60 days after order until lease is assigned or rejected.

Executory Contracts- Trustees

1. US Trustee has determined counseling agencies are not reasonable available within the district where debtor resides. 2. The debtor certifies to the court that she requested counseling but was unable to obtain services within 7 days of request. 3. The court determines that debtor is unable to comply b/c of incapacity; disability; or active military duty in a combat zone. *DEBTOR still must attend a briefing within 30 days after petition is filed

Exemptions to Pre-Petition Counseling

Stay is terminated w/ respect to personal property that secures a claim or is subject to an unexpired lease if the debtor fails to file a statement of intention within 30 days after the petition is filed or fails to take action specified in such statement w/I 30 days after creditor's meeting.

Failure to File Statement of Intention

1. Voluntary Petition of individual or business residing in U.S. or having domicile, place of business, or property in U.S. Involuntary Petition can be filed against anyone who can file a voluntary petition (except farmers and non profits).

Features of Chapter 7 Liquidation Case

After confirmation, court may grant a discharge to a debtor who has not completed plan payments if: 1. failure to pay is due to circumstances for which the debtor should not be held accountable 2. modification of the plan is not practicable and 3. the value of the property distributed under the plan for each unsecured claim equals the amount that would have been paid on such claim if the estate had been liquidated.

Hardship Discharge- Chapter 13

1. Once a case is confirmed, it binds the debtor and every creditor regardless of whether the creditor has accepted the plan.

Post Confirmation Issues

Ct. will grant a creditor's motion to modify the automatic stay for acts against property in which the creditor has a security interest if the debtor has no equity in the property and the property is not necessary for an effective organization.

Lack of Equity

*Most Common* Liquidation of the debtor's assets by a trustee to pay creditors' claims. The debtor gets a "fresh start" by receiving discharge of debts. -Liquidation for corporation or partnership results in termination of business.

Liquidation Chapter 7

Trustee and creditors have an opportunity to orally examine the debtor to ensure the debtor is aware of the consequences of and alternatives to receiving a discharge in bankruptcy. -usually 20 to 40 days after entry of the order for relief.

Meeting of Creditors

Any time after confirmation or before all payments have been made, debtor, trustee, or any unsecured creditor may propose a modification of the plan, but debtor must agree to it.

Modification

Most be provided to the Trustee seven days before first creditors' meeting. Failure to do so results in dismissal

Most Recent Tax Return

Applies to insolvent municipalities (NOT TESTED ON BAR)

Municipal Debt Adjustment- Chapter 9

1. Debtor is given the exclusive right to file a plan for 120 days after entry of the order for relief.

Plans of Reorganization

1. Tax Claims- any claim entitled to a priority. Tax obligations with respect to which returns were not filed. 2. Debts incurred by fraud, embezzlement, and larceny- a timely complaint must be filed with the bankruptcy court and the court determines the claim to be nondischargeable. In the absence, debt is discharged. 3.Luxury Goods and Services- if debts aggregate 600.00+ and incurred with 90 days of the order for relief.- creditor must file timely complaint. 4. Open-Ended Credit Plans to consumer- if debt incurred within 70 days of order for relief and exceed $875 in aggregate- timely complaint must be filed 5. Unscheduled Debts (unlisted)- nondischargeable unless creditor has notice or actual knowledge of the bankruptcy in time to make a timely filing. 6. Domestic Support Obligations/Property Settlement from Divorce or Separation. 7. Willful and Malicious Injury to property or a person- timely complaint must be filed with the bankruptcy court. 8. Liabilities Incurred with Operating Vehicle, Aircraft or Vessel While Intoxicated 9.Fines and Penalties owed by a governmental unit 10. Student Loans- unless it would impose an "undue hardship" for the debt to survive. a. inability to maintain a minimal standard of living b. additional circumstances exist indicating that the state of affairs is likely to persist for a significant portion of the repayment period; and c. Debtor has made good faith effort to repay.

NON DISCHARGEABLE DEBTS OF CHAPTER 7***

Grounds for denial of discharge include: 1. Debtor not being an individual 2. Fraudulent transfer/concealment of propert 3. failure to keep books and records; 4. commission of a bankruptcy crime; 5. refusal to obey court orders or answer questions 6. failure to complete a financial management course 7. prior discharge under Chapter 7 or 11 within 8 years, or under chapter 12 or 13 w/I 6 years.

Objection to Discharge

1. His home- principal place of residence 2. All household and kitchen furniture held primarily for personal, family, educational, or household use. 3. All books, portraits, and pictures held primarily for the personal, family, or household use. 4. Interest up to $3,000 in wedding/anniversary rings 5. Interest up to $4,000 in aggregate value in wearing apparel 6. All professional prescribed health aids for person/dependents 7. Interest up to $7,500.00 in value in one motor vehicle 8. Any cemetery lots; 9. Guns up to $2,000 in value, except for guns mainly as an investment or for non-personal use. 10. implements of husbandry necessary to farm the homestead, and tools, apparatus, and books used in a trade or profession, up to $10,000 in value. 11. Five milk cows and calves under 6 mos; 100 chickens, 2 horses and 2 bridles and 2 saddles, 10 hogs, and 20 sheep 12. All provisions and forage on hand, or growing for home consumptions, and for the use of exempt stock for one year; 13. 75 percent of all current wages or earnings for personal or professional services earned during the last 90 days 14. Right to receive alimony, support, separate maintenance, or child support payments 15. Any interest in a qualified retirement plan or arrangement such as contribution plans and benefit plans as defined under IRC 16. Interest in a claim for personal bodily injury, death, or workers comp. up to $50,000, not including exemplary or punitive damages 17. Funds in and individual development account established pursuant to sec. 251. 18. Any amount received pursuant to a federal earned income tax credit; and 19. Any interest in an Oklahoma College Savings Plan account.

Oklahoma Exemptions: CANNOT USE FEDERAL- entitled to property as to protect her from complete destitution.

Rural- not within city or town; may consist of up to 160 acres of land. Urban- may consist of up to one acre of land. If more than 25 percent of the total square footage is used for business purpose; amount is limited to $5,000.

Oklahoma Homestead Exemptions

1. Priority Claims according to respective ranks 2. Allowed unsecured claims for which timely proofs of claim were filed (w/I 90 days after the date set for the first meeting of the creditors). May be filed late if due to excusable neglect. 3. Allowed unsecured claims for which proofs of claim were filed late 4. Claims for fines, penalizes forfeitures, or punitive damages 5. Claims for interest that accrues after the petition is filed; and 6. If a surplus remains, it is distributed to the debtor.

Order of Distribution of Estate in Chapter 7 Case

Debtor begins payments within 30 days after date plan was filed or the relief was entered.

Payments

A debtor who is an individual must have received from an approved, nonprofit budget and counseling service a briefing that outlines opportunities for credit counseling and assists her in performing a budget analysis. Must occur within 180 days of filing petition.

Pre-Petition Counseling

-Transfer of a debtor's interest in property for or on account of a antecedent debt made or suffered by the debtor while insolvent and within 90 days (one year if insider) before filing the petition in bankruptcy--- the effect of which enables a creditor to obtain a greater % of his debt than he would have received otherwise in a liquidation case. -Trustee has power to avoid preferences. Preference power allows trustee to set a creditor's security interest aside and to reacquire the assets for the benefits of all the creditors. -Prebankruptcy Transactions give rise to Preference Issue.

Preferential Transfers

unsecured claims entitled to be paid before other unsecured claims. 1. Domestic Support Obligations 2. Administrative Expenses- bankruptcy cost 3. Involuntary Gap Claims- claims that accrue in the ordinary course of business after an involuntary petition is filed, but before order of relif. 4. Wage Claims- employees who have claims for wages earned with 180 days before filing of petition or cessation of debtors business. limited to $11,725 per employee. 5. Contribution to Employee Benefit Plans- same restraints as #4, reduced by amounts paid in #4. 6. Claims Against Operators of Grain or Fish Storage Facilities. 7. Consumer Deposits- up to $2,600 "layaway" priority. 8. Tax Claims 9. Capital Requirements of Insured Depository Institutions 10. Personal Injury Claims Resulting From Intoxicated Operation of a Vehicle.

Priority Claims

-Petition filed -Copy served on debtor with summons -Debtor files an answer or make a motion prior to -Trial is held -Court will order liquidation if a ground for involuntary bankruptcy is established. -If order of liquidation is entered, case follows same procedures as are followed in voluntary case.

Procedure for filing Involuntary Bankrtuptcy

1. Property Interest and Earning acquired by individuals filing a Chapter 13 or Chapter 11 petition, but before the case is closed, dismissed or converted to another chapter ar epart of the bankruptcy estate. 2. Proceeds of property of the state 3. Inherited Property- if w/I 180 days after petition is filed 4. Life Insurance and Death Benefit Proceeds- if w/I 180 days after petition is filed. 5. Property Settlements and Divorce Decrees- if w/I 180 days after bankruptcy petition is filed.

Property Acquired After Petition Filed- not become part of estate. Five Exceptions

1. Agreement must have been made before the granting of the discharge. 2. The agreement must contain clear and conspicuous provisions that reaffirmation is not mandatory and that the debtor has the right to rescind the agreement any time prior to discharge or within 60 ays after the agreement is filed with the court by giving notice of rescission to the claimholder; 3. Upon discharge, court must hold a reaffirmation hearing and inform the debtor that the reaffirmation is not required by law, and must advise debtor of legal affect. If debtor is represented by counsel, hearing not required, but counsel must file affidavit with the court that debtor was fully advised of the effect; and 4. In the case of consumer debt (except for a real estate mortgage) where debtor is not represented by counsel, court must approve reaffirmation agreement upon a determination that it does not impose undue hardship on the debtor and is in the debtor's best interest.

Reaffirmation of Discharged Debts Requirements

Order granting relief from the stay benefits for the party who applied for it and covers only the activity specified in the motion. Order is stayed for 14 days after entry.

Relief from Automatic Stay

1. file petition of relief: a) list name and addy of 20 largest unsecured creditors (excluding insiders) b) list of the debtor's equity security holder c) list of all creditors schedules of assets and liabilities, and a statement of affairs.

Reorganization Chapter 11

(Usually Corps). Debtor avoids liquidation designed to rehabilitate failing business by extending, reducing, or other wise adjusting debts and reorganizing the business.

Reorganization- Chapter 11

1. designate classes of claims and interest; 2. Specify the classes that are impaired; 3. Specify the treatment of the impaired classes; 4. Provide equal treatment for each member of a particular class, unless a class member consents to less favorable treatment; 5. Provide adequate means for implementation of the plan, 6. Have been proposed in good faith, 7. Pass the Best interest of creditors test 8. Have been accepted by each impaired class; 9. When a debtor is an individual, provide for payment to creditors of all earnings from personal services performed by the debtor after commencement of the case, or other future income of the debtor.

Requirements of Plan

On request of party in interest within 180 days after entry, the court may revoke order if it was procured by fraud.

Revocation of Confirmation Order

Transferee who takes property in good faith and for value is protected from by having a lien on the property to the extent of the value given to the debtor. (meaning, Trustee must pay the purchase price before recovering.)

Rights of Transferees in Fraudulent Transfers

A creditor whose claim is secured by real property interest is entitled to relief from a stay if the bankruptcy petition was part of a scheme to delay/defraud creditors that involved multiple filings affecting the property or transfer of an interest in the property w/o the consent of the creditor or the court.

Scheme to Defraud Creditors

A claim is treated as a secured claim to the extent that the creditor had a valid security interest, mortgage, statutory lien or judicial lien. Secured up to the value of the collateral or property subject to the lien. If value is less than amount of the claim creditor has unsecured claim to the deficiency. -Property rights- creditor must be protected against depreciation and is entitled to receive collateral or its value when estate is liquidated and distributed

Secured Claims

1. Debtor must have received the goods w/I 45 days before commencement of the bankruptcy case. 2. Seller must make a written demand for reclamation w/I 45 days after the debtor receives the goods, or within 20 days after commencement of the case if the 45-day period expires after the commencement; 3. Debtor still has possession of the goods; and 4. Goods are not subject to the prior right of another security interest in the goods.

Seller's Right to Reclaim Goods sold to an insolvent buyer.

Not permitted. Court will not grant Chapter 13 discharge if debtor received a discharge under chapter 7, 11, or 12 during four years preceding the date of the order of relief; or Chapter 13 during two-year eriod preceding order.

Serial Discharges

1. Statutory Liens that first become effective against the debtor upon one of the following events: (a) bankruptcy cases is commenced (b) when insolvency proceeding commences (c) when a custodian is appointed or takes possession of debtor' s property (d) when the debtor becomes insolvent (e) when the debtor's financial condition fails to meet a specified std or (f) when another creditor levies on the property 2. A statutory lien that is not perfected as against a bona fide purchaser as of the date the petition is filed 3. Landlords' lien for rent or distress of rent

Statutory Liens Not Valid against Trustee

Trustee is given power to avoid any transfer voidable under nonbankruptcy law by an unsecured creditor who has an allowable claim. any security interest or other transfer voidable by an actual unsecured creditor may be avoided by the trustee. (recover assets for the benefit of the estate).

Trustee Claiming Rights of Other Creditors

1. Trustee has right and powers of a creditor, who upon the date the bankruptcy cases commences, obtained a judicial lien on all property of the debtor. Trustee automatically obtains a lien, avoiding any property interest or claim against debtor that, on the date of bankruptcy, could have been avoided. -Any security interest in the debtor's personal property that is unperfected on the date the petition is filed is void against the trustee b/c a lien creditor would have priority over the unperfected security interest. The trustee is subject to retroactive perfection.

Trustee a Hypothetical Lien Creditor

Trustee is given the rights of a bona fide purchaser of the debtor's real property as of the date the bankruptcy petition is filed. Any transfer or interest in real estate that may be avoided by a bona fide purchaser may be avoided by the trustee.

Trustee as Hypothetical Bona Fide Purchaser of Real Estate

Trustee may not assume the debtor's unexpired lease or executory contract in default unless Trustee: 1. Cures or provides adequate assurances that he will promptly cure, the default; 2. Compensates or provides adequate assurances that he will promply compensate, a party to the lease or contract, for any actual pecuniary loss to the party resulting from the default; and 3. Provide adequate assurances of future performance under the lease or contract.

Trustee's Power when Unexpired Lease or Executory Contract is in Default

-Appointed by the Attorney General (one for every 21 regions). -5 year terms -Subject to removal by Attorney General

Trustees

1. Liquidation- Chapter 7 2. Municipal Debt Adjustment- Chapter 9 3. Reorganization- Chapter 11 4. Adjustments of Debts of Individual with Regular Income- Chapter 13 5. Adjustment of Debts of Family Farmer with Regular Annual Income- Chapter 12 6. Ancillary Cases- Chapter 15

Types of Bankruptcy Cases

debtor is protected against the loss of utilities solely b/c of nonpayment of the bills for prebankruptcy service. Utilities must receive adequate assurances w/I 20 days after the order for relief that bills will be paid for post bankruptcy services.

Utility Services

Transfer is made when it become so far perfected as to prevent a subsequent bona fide purchaser from acquiring superior rights. *Security Interest or Real Estate Mortgage- Perfected or Recorded; if not transfer is deemed to have been made immediately before petition is filed.

When Transfers Occur?