| Bankruptcy Court Jurisdiction and Venue |
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| Consistent with the policy of providing relief for the honest debtor and fair treatment of creditors, and pursuant to its constitutional authority, Congress created bankruptcy courts. The bankruptcy judges in each federal judicial district constitute a ''unit'' of that district court known as the bankruptcy court. All district courts have referred their authority to hear bankruptcy cases to bankruptcy courts. Appeals from bankruptcy courts are heard by the district court or by a bankruptcy appellate panel.More... |
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| Estate Property |
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| The commencement of a voluntary, joint, or involuntary bankruptcy petition automatically creates an "estate." The estate is comprised of all the property that is described in section 541 of the Bankruptcy Code. It includes all legal or equitable interests of the debtor in property, wherever located, as of the commencement of the case. To determine a debtor's rights in property, a court examines state law.More... |
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| Debtor Eligibility |
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| There are different eligibility requirements under the various chapters of bankruptcy. Eligible consumers and businesses can file under Chapter 7 and Chapter 11. Only family farmers are eligible to file under Chapter 12, and only individuals are eligible to file under Chapter 13.More... |
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| Administrative Claims |
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| Administrative expense claims in bankruptcy cases are entitled to first priority ahead of all other general unsecured claims and, therefore, they are paid in full before all other unsecured claims to the extent there are available unencumbered funds in the debtor's bankruptcy estate. Administrative expense claims are given first priority status in bankruptcy to induce parties to do business with the debtor's bankruptcy estate.More... |
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| Preferential Transfers |
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| A trustee in bankruptcy may avoid certain statutory liens, fraudulent transfers, as well as preferences. The Bankruptcy Code provides that certain transfers made by a debtor within close proximity of bankruptcy are preferential to the recipient and violate the Bankruptcy Code's policy of equal treatment of creditors. The elements of a so-called "preference" or "preferential transfer" are easy for a trustee in bankruptcy to prove. The defenses available to the creditor are limited and the cost to litigate can be high. More... |
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