Tag Archives: trustee

Providing notice re domestic support claims:

If there is a claim against the debtor for a domestic support obligation (see 11 USC § 101(14A)), the trustee shall:
—provide written notice of the claim to the claimholder and inform the claimholder of the right to use the services of the state child support enforcement agency located in the state where the holder resides for assistance in collecting child support during and after the bankruptcy case;

—include in the notice to the claimholder the address and telephone number of the state child support enforcement agency;

—include in the notice to the claimholder an explanation of the holder’s rights to payment of the claim in the Chapter 7 proceeding;

—provide written notice to the state child support enforcement agency of the claim; and

—include in the notice to the state agency the claim holder’s name, address and telephone number. [11 USC § 704(a)(10),(c)(1)(A) & (B)]
Additionally, once the debtor has been granted a discharge under § 727, the trustee shall provide notice to both the claimholder and state child support enforcement agency of:

—the debtor’s discharge;

—the debtor’s last recent known address;

—the last recent known name and address of the debtor’s employer; and

—the name of each creditor who holds a claim that (i) was not discharged under §§ 523(a)(2) (money obtained under false pretenses), 523(a)(4) (fraud or defalcation in fiduciary capacity), or 523(a)(14A) (debt incurred to pay tax to governmental unit); or (ii) was reaffirmed by the debtor under § 524(c). [11 USC § 704(c)(1)(C)]

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Examining and objecting to proofs of claims

“If a purpose would be served,” the Chapter 7 trustee must examine proofs of claims and object to improper claims. [11 USC § 704(a)(5); see In re BCD Corp. (10th Cir. 1997) 119 F3d 852, 859—Chapter 7 trustee obligated to contest claims against estate as to which defenses exist; In re Mazzocone (BC ED PA 1995) 183 BR 402, 415, fn. 4]

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Selling debtor’s assets and using proceeds to pay creditors

To “maximize value,” the trustee is authorized to sell any nonexempt property owned by the debtor that has monetary value exceeding any encumbrances and to use the proceeds to pay administrative costs and creditor claims (see ¶ 10:97 for order of distribution). The trustee may also sell partially exempt property, but must pay the debtor the exemption amount, distributing the balance of the proceeds. Where (as is frequently the case) the debtor’s assets have little or no “value,” creditors will receive no distributions from the Chapter 7 estate.

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Liens

The Chapter 7 Trustee has the power to determine the priority of the liens.

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