Chapter 7 bankruptcy, also known as liquidation bankruptcy, is a relatively straightforward process for individuals who qualify for this particular chapter of consumer bankruptcy. However, disputes over who actually owns the property to be liquidated can muddy the waters, adding complicated measures to the process.
If you are attempting to collect from a Nevada debtor who is under bankruptcy protection, you will find great benefit in leaning on the guidance of an attorney who can protect your interests throughout the entire process. When property rights are in question, it can be difficult to get the money to which you have a rightful claim. Your lawyer can tenaciously advocate for your rights as a creditor.
When a debtor’s property may not actually be the debtor’s property
Sometimes, it is not always clear who actually owns the property in question. Examples of how property rights disputes or concerns can complicate the bankruptcy process include:
- A car sitting in a repair shop instead of at the owner’s property
- Property being held in a trust by the debtor
- Assets and goods stored in a warehouse
- Property being held for consignment
In situations where the debtor may not actually own the property, there could be an exclusion of that asset from bankruptcy. Things can become even more complicated when the debtor in bankruptcy is a business or corporation, not an individual consumer. Due to the terminology that dictates the completion of many supply transactions, it can be quite difficult to determine who owns what property should the business file bankruptcy.
Properly identifying property ownership is particularly complex in transactions that involve multiple parties, such as suppliers, manufacturers and retailers. While it is certainly complicated to accurately determine which party owns the property in question, an experienced bankruptcy lawyer knows how to evaluate transaction contracts and determine how you can get your money.
Avoid surprises and collect your money
It is beneficial for your business when liquidation proceedings move as quickly as possible. Unpleasant surprises or complications regarding the ownership of property in bankruptcy can delay proceedings, thereby delaying your payment. You can protect your rights as a creditor by first developing a strategy that identifies eligible property, assets available and other creditors that may need to be paid.
With a plan and knowledgeable guidance, creditors can effectively navigate the bankruptcy process and secure the money that is available. Careful evaluation can identify how to proceed and how to protect your interests against those of other creditors also attempting to collect.