Bankruptcy Appeals

  • Bankruptcy Courts are part of the Federal Court system.
  • To appeal a decision one must appeal to Bankruptcy Appellate Panel (BAP) of the Federal Circuit. From there appeals go to the Circuit Court of Appeals.
  • Basis for appeal is similar to State and Federal appeals: legal error on the part of the Bankruptcy Court.
  • Appeal is based on lower Court’s record and Appellate Court will not entertain additional evidence or hear witnesses

Fundamentals of Bankruptcy Law and Procedure in Illinois Chapter 13 Issues

“Should I stay or should I go…” Chapter 13 or Chapter 7?

  • Chapter 7: Debtor’s non-exempt property liquidated to pay debts of the Estate
  • Orders creditors not to attempt collection of debts in future
  • Chapter 13: portion of Debtor’s future income is used to pay Estate obligations, as feasible
  • Broader release of several types of debts not dischargeable in Chapter 7
  • More expensive for the Debtor
  • Takes longer

Fundamentals of Bankruptcy Law and Procedure in Illinois The Creditor’s Perspective

The Importance of Pre-Bankruptcy Collection: 90 Days Plus

  • Bankruptcy Code makes it extremely important to collect more than 90 days prior to the filing of a Petition.
  • §547(b): payments made within 90-days prior to filing are presumptively preferential and therefore fraudulent.
  • Both State and Federal law provide that any transfer by an insolvent Debtor on account of an antecedent debt is presumptively fraudulent.
  • Once Debtor has filed an Automatic Stay goes into effect and the Creditor is virtually powerless.