Proof of Claim

If you received a notice of bankruptcy filing and notice of meeting of creditors someone or a business that owes you money filed for bankruptcy protection and you are listed in the petition as a creditor. Depending upon the circumstances you may need to file a proof of claim to be paid your fair share of the assets of the bankruptcy estate. In bankruptcy you must file a proof of claim to receive any money for the debt or claim you are owed. We will review the bankruptcy documents and advise you regarding likelihood of payment of part or all of what is owed to you. Mr. Wood formerly worked for the Chapter 13 trustee for the San Francisco and Santa Rosa Divisions of the Bankruptcy Court for the Northern District of California. He has administered, reviewed and filed thousands of bankruptcy cases in California.

Federal Rule of Bankruptcy Procedure 3001 governs what constitutes a valid claim and the evidentiary effect. If a proof of claim is filed in accordance with the applicable rules, then the claim become prima facie evidence of the validity of the claim. All filed claims should include documentation for the basis of the claim and how the claim was calculated. If proper documentation is not attached to the proof of claim, the bankruptcy filer or trustee will most likely object to the validity of the claim. There also can always good faith disagreement as to the amount owed at the time the bankruptcy case was filed. Ultimately the judge assigned to the case may have to rule as to the amount of a claim.

What is your fair share is a complicated question and depends upon many factors. Is the bankruptcy case a Chapter 7, Chapter 13 or Chapter 11? What kind of claim do you have? A secured claim, priority unsecured claim or general unsecured claim? Are there even assets or income available to creditors to pay anything at all?

Chapter 7 Bankruptcy

Most individual Chapter 7 bankruptcy cases that are filed are no asset cases. This means that the applicable exemptions can protect all of the assets the bankruptcy filer owns. That means all assets are exempted from the bankruptcy estate. After the completion of the meeting of the creditors the Chapter 7 trustee will file their notice of no distribution when there are no assets available to creditors. The bankruptcy filer will then receive a discharge of their eligible dischargeable debts and the case will be closed.

If there are assets available to creditors the Chapter 7 trustee will file a notice of possible dividend or that there are assets available to creditors. The notice will usually contain the deadline for creditors to file their proof of claim. If you do not file a claim on time you will most likely receive nothing from the bankruptcy estate.

Chapter 13 or Chapter 11 Bankruptcy Reorganization

In a Chapter 13 or Chapter 11 each and every creditor should always file a proof of claim. There are always assets or income available to creditors in reorganization cases. That does not mean that you will be paid on your claim, but again, you have to file a claim to ever receive any money in a bankruptcy case.

Object to Discharge or Dischargeability of Debt

Maybe you have a right to object to the discharge of what is owed to you because the person or business that filed for bankruptcy committed some sort of fraud or lied to get credit extended to them. Even if you think what is owed to you should not be discharge due to fraud you still need to file a proof of claim in the main bankruptcy case.

For more information about your rights if someone that owes you money filed for bankruptcy protection under Chapter 7, Chapter 13 or Chapter 11 please give us a call at 1-877-963-9543 to schedule a consultation at one of our convenient Bay Area Office Locations.