A Chapter 11 bankruptcy case can be quite complicated. A Chapter 11 is a business reorganization. Usually when individuals file a Chapter 11, they do it in conjunction with their business.
If you’re thinking of filing a Chapter 11 bankruptcy case, an experienced New York bankruptcy lawyer can help. At New York Lawyers Team, we have over 30 years of combined experience offering legal services in Chapter 7, 11, and 13 cases in New York and across New York.
Chapter 11 cases aren’t very popular — in New York, or the U.S. Fewer than 100 Chapter 11 cases are filed in all of New York each year. By comparison, about 10,000 Chapter 7 cases are filed yearly in our state, while another 2,500 Chapter 13 cases are filed.
In many regards, Chapter 11 is similar to a Chapter 13 in that it is a plan for reorganization. In many regards, it is completely different that a Chapter 13.
Chapter 11 cases usually reorganize a business: a corporation, sole proprietorship, or partnership. A bankruptcy case involving a sole proprietorship includes both business and personal assets of the owner-debtors. Partnership cases also may include personal assets, or force partners themselves to file for bankruptcy protection.
Additionally, Section 1107 of the Bankruptcy Code puts more work on the debtor as a fiduciary, giving him or her the rights of a Chapter 11 Trustee without the investigative functions. They must account for property, examine and object to claims, and file monthly operating and other reports required by the court and U.S. Trustee or bankruptcy administrator. 11 U.S.C. §§ 1106, 1107; Fed. R. Bankr. P. 2015(a).
Unfortunately due to their complexity, Chapter 11 bankruptcies are very expensive. The average small business cannot afford the fees for a Chapter 11; the court fees for non-railroad businesses are more than $1,700 alone in New York.
Moreover, it is usually not in the debtor’s best interest to file a Chapter 11. Oftentimes, there may be other avenues to achieve the client’s goals, such as a Chapter 13 plan or even a Chapter 7 bankruptcy.
If you think you need to file Chapter 11 bankruptcy, you should contact one of the qualified attorneys of New York Lawyers Team as soon as possible. We can help you determine if Chapter 11 bankruptcy in New York is right for you, or if other options would be more financially smart.
Because we represent both debtors and creditors, we know both sides of the coin when it comes to bankruptcy. Our experience is invaluable to both consumer and business clients — just take a look at some of our dozens of client testimonials.