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What if no proofs of claim are filed? Personal Bankruptcy

Discussion in 'Bankruptcy Law' started by OceanSun, Jun 7, 2014.

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  1. OceanSun

    OceanSun Law Topic Starter New Member

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    I understand that in order for a creditor to get paid in a chapter 13 bankruptcy they have to file a proof of claim. It's also my understanding (correct me if I'm wrong) that a 13 has to be set to be either 3 or 5 years long. Just out of curiosity, what if no creditors filed a proof of claim but he 90 day cutoff? Would the bankruptcy then be fully discharged or would they make you wait at least 3 years with no payments since there would be nothing to pay?
     
  2. despritfreya

    despritfreya Active Member

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    In all likelihood, if absolutely no claims are filed (not going to happen), under 11 USC 501(c) the Trustee will file claims on behalf of the creditors. He/she will utilize the debtor's schedules to justify what he/she files. The Trustee has 30 days from the claims bar date to file claims on behalf of the creditors. (See Bk Rule 3004)

    Des.
     
    Michael Wechsler likes this.
  3. OceanSun

    OceanSun Law Topic Starter New Member

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    Why would the trustee file the proofs of claim? I know there are times when you want them to be filed such as a mortgage where you are keeping the home. But other than that, what would be the purpose?
     
  4. army judge

    army judge Super Moderator

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    Have you discussed this with your BK attorney?

    Des never offers incorrect information.

    As he said, what you're inquiring about never happens.

    I should say, I've danced around a couple mulberry bushes in my life, and I've never seen it.

    That said, you need to sit down with your BK attorney and make sure you understand what you are about to embark upon.
     
  5. OceanSun

    OceanSun Law Topic Starter New Member

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    I'm not disputing whether Des is right or wrong. Des says the trustee will file them, so be it. All I'm asking is why would they do so?
     
  6. army judge

    army judge Super Moderator

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    Does the trustee work for free?
    That's one of the ways the trustee gets paid.
    I've already told you that.
    Okay, closing the thread before things get contentious.
     
  7. OceanSun

    OceanSun Law Topic Starter New Member

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    What if no proofs of claims field #2

    "Does the trustee work for free?
    That's one of the ways the trustee gets paid.
    I've already told you that.
    Okay, closing the thread before things get contentious."

    Really man? First of all, NO you DID NOT say that. You jumped my rear for (in your mind) calling Des wrong, then you claim you said something that you did not, then you close it off so you don't get called out. You see that scrolling banner you have as your signature? Why don't you try following that? How about instead of having a fit because I dare insult one of your fellow members by (in your mind) calling them wrong, why not just a simple answer?

    All I did was ask a simple, hype hypothetical question. Yes, I get it. It doesn't actually happen. It was a simple what if it did.
     
  8. cbg

    cbg Super Moderator

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    The problem with hypotheticals is that there are no straight facts to deal with. You can make the facts do anything you want them to, and if any of the ACTUAL facts do not meet the hypothetical, then the answer is going to be different. You can't give an accurate answer to a hypothetical.
     
  9. Proserpina

    Proserpina Moderator

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    For what it's worth, just because we're senior members doesn't mean we agree with each other, or that we share the same viewpoints.

    That's all I'll say.
     
  10. Michael Wechsler

    Michael Wechsler Administrator Staff Member

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    Did you read what that statute says? I can offer an opinion as to why. A discharge in bankruptcy is not a right. It has to be granted by the court. I am quite sure that the debtor can also file a proof of claim on behalf of creditors so that they can be included and get paid out of the proceeds of the bankruptcy estate. So, in essence, the onus is on the debtor to include the debts for discharge. It wouldn't seem fair to put the onus on the creditors and say "if you don't counterfile, you lose the right to the debt that the debtor hasn't paid for all this time." I've reopened the thread to comments with the knowledge that we can have a civil discussion.

    11 U.S. Code § 501 - Filing of proofs of claims or interests

    a) A creditor or an indenture trustee may file a proof of claim. An equity security holder may file a proof of interest.
    (b) If a creditor does not timely file a proof of such creditor’s claim, an entity that is liable to such creditor with the debtor, or that has secured such creditor, may file a proof of such claim.
    (c) If a creditor does not timely file a proof of such creditor’s claim, the debtor or the trustee may file a proof of such claim.
    (d) A claim of a kind specified in section 502 (e)(2), 502 (f), 502 (g), 502 (h) or 502 (i) of this title may be filed under subsection (a), (b), or (c) of this section the same as if such claim were a claim against the debtor and had arisen before the date of the filing of the petition.
    (e) A claim arising from the liability of a debtor for fuel use tax assessed consistent with the requirements of section 31705 of title 49 may be filed by the base jurisdiction designated pursuant to the International Fuel Tax Agreement (as defined in section 31701 of title 49) and, if so filed, shall be allowed as a single claim.
     
  11. OceanSun

    OceanSun Law Topic Starter New Member

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    I've read of cases where some of creditors don't file a proof of claim, which got me wondering what would happen if they all failed to do so. It would seem logical that if there are cases where some don't, why couldn't it happen where none do? I didn't know that the debtor or the trustee could do so. Knowing that they can, now it makes sense why they would do so.
     

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