Few things are more detrimental to the success of your business than not being paid for the goods you have provided or for the hard work you have done for your customers.
Attorneys at the San Jose, California, law firm of Diemer, Whitman & Cardosi, LLP, offer experienced debt collection assistance to commercial creditors throughout Silicon Valley and the San Francisco Bay Area. In fact, each of the attorneys at our firm has been practicing law for more than 25 years. To learn more about our commercial debt collection practice and the steps we can take to recover your assets, call or contact us to schedule a free initial consultation with one of our attorneys.
Debt Collection and the Bankruptcy Process
When a consumer or business obtains Chapter 7, Chapter 11 or Chapter 13 bankruptcy protection, you still have rights as a business owner. In fact, federal bankruptcy laws afford significant protections to creditors and businesses in bankruptcy.
Two of the most important tools available to protect your interests and to increase the percentage of debt you recover in the bankruptcy process are the adversary proceeding and preference litigation.
- Adversary proceedings: In the context of commercial debt collection, an adversary proceeding is a lawsuit filed against a debtor during the bankruptcy process. In most cases, this type of action asks the court to rule on the appropriateness of discharging a particular debt. By law, debts incurred through fraud and other bad faith means fall outside the scope of debt relief afforded by the U.S. Bankruptcy Code.
- Preference litigation: If a debtor paid one of its creditors within 90 days of filing for bankruptcy, allowing the creditor to receive more than it would otherwise receive through the distribution of the bankruptcy estate, that creditor may be subject to a preference action. In this type of litigation, a bankruptcy trustee can recover preferential transfers for the benefit of the bankruptcy estate. Our lawyers defend creditors in preference lawsuits trying to prevent or limit the need to turnover funds.
If you are concerned that one of your debtors is insolvent or have questions about collecting an unpaid debt from a debtor who has already filed for bankruptcy, call or contact Diemer, Whitman & Cardosi, LLP to schedule a free initial consultation.
