Cx flyboy From Hong Kong, joined Dec 1999, 6341 posts, RR: 56 Posted (10 years 5 months 2 weeks 18 hours ago) and read 895 times:
I know this has been briefly mentionned on other topics, but I have little knowledge of the way things work in the US with regards to bankrupcy. I think I understand Chapter 11 as it has been explained on some other topics. How about the other Chapters? There's Chapter 13 right? So that means apart from 11, there are 12 other chapters? Can someone explain each one?
B747-437B From , joined Dec 1969, posts, RR: Reply 1, posted (10 years 5 months 2 weeks 18 hours ago) and read 862 times:
The three "chapters" of Bankruptcy law in the US can be explained as :
a) Chapter 11
This is bankruptcy re-organization for corporations. You get to defer and restructure payment on existing debt PROVIDED you can continue to make payments and operate on debt/revenue being incurred/earned on a current basis. The creditors have a say in how you run your business through the creditor's committee and the bankruptcy trustee with the court being the final authority.
b) Chapter 13
Essentially the same as Chapter 11, except for individuals. You get to reorganize your debt and defer/restructure your payment of that to fit your financial circumstances, subject to approval of the court.
c) Chapter 7
A straightforward liquidation of corporate assets to pay off the debt owed.
Hkg_clk From Hong Kong, joined Jan 2001, 999 posts, RR: 2 Reply 6, posted (10 years 5 months 2 weeks 9 hours ago) and read 721 times:
I'm no US lawyer but here's how I think it works.
US bankruptcy law is contained in title 11 of the United States Code.
Within title 11, the bankruptcy laws are divided into chapters (merely for easy reading, like the way books are divided into chapters 1, 2, 3.....).
It happens that the specific provisions relating to liquidation are in chapter 7 of title 11, corporate reorganisations in chapter 11, and provisions relating to individuals in chapter 13. Other chapters exist, but may relate to more general things.