An appointed Chapter 11 trustee essentially becomes the CEO of the debtor, exercising such day-to-day control as he or she deems appropriate.
The trustee, therefore, essentially displaces the management that got the debtor in its financial predicament.
Such debtors must file: a certificate of credit counseling and a copy of any debt repayment plan developed through credit counseling; evidence of payment from employers, if any, received 60 days before filing; a statement of monthly net income and any anticipated increase in income or expenses after filing; and a record of any interest the debtor has in federal or state qualified education or tuition accounts.11 U.
On September 26, 2014, the Plan became effective and was substantially consummated. Trustee Offices and 95 field offices that operate in all federal judicial districts except those located in Alabama and North Carolina. Trustee in a Chapter 11 bankruptcy case are set forth in 28 U. A chapter 11 debtor usually proposes a plan of reorganization to keep its business alive and pay creditors over time. In addition, no individual may be a debtor under chapter 11 or any chapter of the Bankruptcy Code unless he or she has, within 180 days before filing, received credit counseling from an approved credit counseling agency either in an individual or group briefing. A petition may be a voluntary petition, which is filed by the debtor, or it may be an involuntary petition, which is filed by creditors that meet certain requirements. People in business or individuals can also seek relief in chapter 11. As chapter 11 filings increase, so will the number of chapter 11 liquidations. §1146(c) provides that "The issuance, transfer or exchange of a security, or the making or delivery of an instrument of transfer under a plan confirmed under §1129 of this title, may not be taxed under any law imposing a stamp tax or similar tax," failing to pay other taxes could create personal liability for the liquidation trustee if the liquidation trust's assets are depleted. The court held the trustee personally liable under 26 U. Although the trustee in Hemmen was not held personally liable for taxes, it is an example of the caution a liquidation trustee must exercise in administering the liquidation trust.