Gotta love being a small business owner

[cwtebay]

Had a client that my staff and I bent over backwards for, went above and beyond what we should have done.
Today, got a notice that they filed for bankruptcy - to the tune of a nice used truck. Can't contact them, can't send an invoice, just nothing... unless i want the bankruptcy court to fine me!! My office manager snooped on their Facebook page, where they are enjoying a nice getaway to Hawaii!!!
Not sure how many of y'all have gotten stuck this way - but how do the crooks end up with more rights than me???

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[contender1]

I'd consult with an attorney, to see how you go about filing a claim against the action.
Reading that paper, they are seeking a "discharge" of debts. That means they want the court to allow them to not pay any claims. You do have the right to file in the bankruptcy clerks office as noted in the letter as a creditor. The courts will be the determining factor in if they owe you money, and if you can recover anything. Let the lawyer guide you. DO NOT HESITATE, there is a time limit.

My family had a similar instance many years ago. When the folks filed bankruptcy Dad filed that they owed him X amount of money. Any assets they had that were not protected, (immediate dwelling, and a personal vehicle, etc,) were subject to sale & debtors to be paid. Sadly, big companies, such as banks, etc are first in line for any money. It all comes down to how much money is made from the sale of any assets, and what position in line you are to receive any funds.

It's a legal nightmare.

In our case, my Dad was the 2nd mortgage holder. To prevent the loss of tens of thousands, (commercial store) my dad got his lawyer to filed & fight. He was able to get the courts to award him the property back, BUT,,, he had to assume the payments on the note from the 1st mortgage. He did, re-opened the business, paid off the note, and later we sold the business.

In that case, the people had spent money in buying a few things, (a second house, putting it in their son's name,) (2) vehicles, (they lost one,) etc. They didn't lose as much as my Dad could have lost.
You have to look at whatever assets they may have that isn't protected & go after that, legally.

Unfortunately, some crooks know how to scam the system. Buy a car, but put it in another person's name. You can't remove a primary means of transportation. Buy a house, putting it in the name of the people living there full time. You can't take that away, as it's their residence. Buy a second house, and put it in a different person's name, and it's not their property anymore, can't touch it.

Talk to a bankruptcy lawyer. You may be able to do something, but you may be hung out to dry. It'll be worth the few hundred for a consult, that can answer your questions.

[myg30]

Sounds like you need to call cousin Rocko or Louie to pay them a friendly visit.
Ahh, the good old days!

Mike

[country gent]

The bad hing is when the companies assists are totaled and all outstanding debts totaled up its divided between the between the claims, you get a percentage of the debt. Once they filed you now need an attorney to contact their attorneys handling the bankruptcy,and have to deal thru them.

[bakerjw]

When people or businesses see that bankruptcy is inevitable, they plan accordingly and move assets to protect "Stuff".
After what has happened this last year, expect to see a lot more of this happening.

[waksupi]

Nearly 40 years ago, I got stiffed by Monte Montana,Jr. Wild West Show. I called his lawyer, was told to get in line with other creditors. Still waiting.

[JimB..]

I’ve lost a lot of money to this same thing, it’s a tough part of small business because we do tend to bend over backwards to help, including extending credit and accepting late payments.

Your case depends upon the specifics of your case, there are no generalities that will help you other than to file a claim. The most important issue to understand if we’re talking about a truck is if you have a specific secured claim against that truck. For example, if he bought the truck from your business and you financed it for him, the financing document probably says that the load is secured by the asset, the truck. If that’s the case then your claim will likely be ahead of the unsecured creditors and as relates to the truck perhaps ahead of a bank’s claim based on a loan secured by all assets of the business.

You may want to hire an attorney, but you could also file the claim and all the paperwork for the sale and financing and just claim that you’re fully secured and will be repossessing the truck.

One other thing, sometimes in bankruptcy the big debtors agree to allow the small guys to get paid first because the legal cost for them is greater that the value of the smaller claims...so be the squeeky wheel, tell them that you’re going all the way, don’t just take what they send you.

[popper]

Gets real tricky with businesses, court may decide you can write off the 'bad' deal. Yes, lots of moves to 'protect' stuff, courts should note this but generally don't.

[cwtebay]

Nearly 40 years ago, I got stiffed by Monte Montana,Jr. Wild West Show. I called his lawyer, was told to get in line with other creditors. Still waiting.

My grandfather got taken by him as well!!!! Was for pasture lease in the 80's.

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[cwtebay]

I'm thinking $500 to the biggest dudes I can find at the seediest bar I can find may be a better choice!!

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[bedbugbilly]

I feel for you - years ago, folks would rather neat horse manure than have to file bankruptcy and they usually had the garbanzos to talk with you and work something out. Today? It's far to easy to file and escape responsibility. Your client can't accept their responsibility but can file and then go to Hawaii? That speaks volumes for their character - just points out why this country is where it is today.

I had a tenant in a commercial building many years ago who tried to pull similar thing but I found out about it before he could file - I had a little heart to heart chat with him about the facts of life - a week later he torched the building to get out of the lease but we couldn't prove it - even after an arson investigation.

As my father told me - life ain't easy - but while there are those that are "takers" - I'm a believer in karma and at some point what comes around will go around and they will get their's. Sorry you have to go through this. especially when you try to help someone only to have them show their true colors.

Good luck to you!

[MT Gianni]

A friend had a contract welding business in the oil patch. Two bankruptcies took him down.

[Hogtamer]

Moving assets in anticipation of bankruptcy is a no-no. Get a lawyer although he prolly is a member of the same country club as the lawyer of the guy that stiffed you.

[Scrounge]

Had a client that my staff and I bent over backwards for, went above and beyond what we should have done.
Today, got a notice that they filed for bankruptcy - to the tune of a nice used truck. Can't contact them, can't send an invoice, just nothing... unless i want the bankruptcy court to fine me!! My office manager snooped on their Facebook page, where they are enjoying a nice getaway to Hawaii!!!
Not sure how many of y'all have gotten stuck this way - but how do the crooks end up with more rights than me???

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Pay attention to Contender1, but also include a copy of the info from their facebook page about the vacation. Intentionally running up bills prior to filing can get their petition denied entirely. I had to file bankruptcy in 2010. I was actually trying to pay my debts, but the healthcare issues, loss of job, inability to find another job because of the healthcare issues, etc, drove us to it. If we'd gone on a vacation and run up the cards for fluff like a vacation the court could have prevented us from discharging our debts.

[Shawlerbrook]

Unfortunately the climate in this country is to coddle deadbeats and lawbreakers while vilifying law abiding, successful people. We have made it impossible for landlords to evict tenants not paying their rent almost indefinitely.

[Bmi48219]

I am not an attorney but if your debtor is incorporated or an LLC their personal assets are probably protected. If so unless their vacation was paid for with a company check or credit card it wouldn’t be reason for a court to deny the bankruptcy.
“To the tune of the cost of a nice used truck” is confusing. Did you sell them a truck or do they owe you enough to purchase one? IMO you need to get an estimate from an attorney of what it will cost to pursue your claim.
If the debtor owes you $40K and the court gives you .25 cent on the dollar, best case your award will be $10K minus attorney & legal costs. I think 25 cent on the dollar is probably optimistic. I sincerely hope I’m wrong on all this and things work out well for you. Good luck.

[Scrounge]

I am not an attorney but if your debtor is incorporated or an LLC their personal assets are probably protected. If so unless their vacation was paid for with a company check or credit card it wouldn’t be reason for a court to deny the bankruptcy.
“To the tune of the cost of a nice used truck” is confusing. Did you sell them a truck or do they owe you enough to purchase one? IMO you need to get an estimate from an attorney of what it will cost to pursue your claim.
If the debtor owes you $40K and the court gives you .25 cent on the dollar, best case your award will be $10K minus attorney & legal costs. I think 25 cent on the dollar is probably optimistic. I sincerely hope I’m wrong on all this and things work out well for you. Good luck.

Document posted says Chapter 7. That is for individuals, not corporations. So getting them prohibited from actually going bankrupt is in the OP's best interest. If it can be done, anyway. Worth a try.

Though the rest of what you say is probably correct. You can affirm a debt, and agree to keep it, too. I did so for the mortgage on my house, for example. I had some income, though not enough to allow me to pay all my debts.

Bill

[turtlezx]

is the truck titled in your name
or his with you as a lien holder??

[Bmi48219]

Document posted says Chapter 7. That is for individuals, not corporations. Bill

I missed the Chapter 7, .... good thing it wasn’t a snake! After some research it appears corporations and LLCs can file chapter 7. Most don’t because if assets aren’t sufficient to satisfy debts some of the shortage can be shifted to the owners or shareholders.
My only experience with bankruptcies was minimal and corporate in nature. I hope it stays that way.

[cwtebay]

A little update.
Turns out the chick that filed isn't (or wasn't when the bills were accrued) married to the guy on the account. Also, since my dealings with them were of a "home business" nature (of which, no income was declared or accounted for) then my claim is deemed outside of the scope of the bankruptcy proceedings.
I then filed a theft of services charge against him and her and her 20 something son - as well as filed a lien on their home (actually their 2nd or 3rd home). Got that done by 9am this morning, by 9:15 their attorney was blowing up my phone. Pretty sure he'd rather have his client pay then rot in jail (tough to get your hourly fee from an inmate I presume).

The long and short of this is that no one should have to work their tail off only to be stiffed on their paycheck. Doesn't matter if you're the business owner or an employee.
I appreciate everyone's input!

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