UNIT 5 LAW301 DB

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School

American Military University *

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Course

301

Subject

Law

Date

Jan 9, 2024

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docx

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1

Uploaded by ProfessorRam11604

Imagine you are a creditor, and you just received a Notice of Chapter 7 Bankruptcy Filing referencing someone who owes you money. Discuss the actions you can take to protect your interest and, more importantly, what things you cannot do and why. Explain the analysis needed to determine your rights under the Bankruptcy Code. Also reference the impact of the Automatic Stay in your response. Creditors may think they don’t have rights when it comes to debtors who file bankruptcy claims against them. However, they do and the rights these creditors have are. They have the right to be heard under Chapter 7 liquidations of debtors’ nonexempt assets and repayment plans for debtors when under Chapter 13. All creditors can also challenge debtors’ rights to discharge. Furthermore, “all creditors are entitled to share in payment from the bankruptcy estate, but only according to the priority of their claims.” Creditors also have rights under secured and unsecured claims. For creditors to protect their assets, they would have to file a proof of claim through the courts. A claim is, “a right to payment or a right to an equitable remedy for breach of performance if the breach gives rise to a right to payment.” Creditors must ensure all documents are filled correctly and attach supporting documents if necessary. When it comes to creditors’ interest, they can file a motion and complaints that help protect their interest. However, the automatic stay, “affords a debtor immediate relief before an individual debtor receives a discharge. 11 U.S.C.A. 362 (a). The automatic stay is one of the fundamental debtor protections provided by the bankruptcy laws. It gives the debtor a breathing spell from his or her creditors.” Although the automatic stay protects debtors from these acts, creditors can still file complaints against the debtor, especially when debtors don’t follow the proceedings under the automatic stay. Frey, M.A.& Swinson, S.K. (2013). Introduction to bankruptcy law (6 th ed.). Cengage Learning, P. 248 https://ambassadored.vitalsource.com/reader/books/9781285630694/epubcfi/6/14[idloc_006.xht ml-itemref]!/4[eid7621]/92[eid13360]/16[eid13972]/2[eid13973]/2[eid13974 ] JUSTIA. (n.d.). Creditors' Rights in Bankruptcy . Https://www.justia.com. Retrieved September 25, 2022, from https://www.justia.com/bankruptcy/collections-credit/creditors-rights/
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