My small Business (S-Corp) Chapter 11 is being converted to a Chapter 7

Asked almost 4 years ago - San Jose, CA

I was hoping for a dismissal, so I could dissolve the corporation. I also had file for an Individual Chapter 7 at the same time I filled for the Chapter 11. The company has very little assets. And at this point I can not sustain my business any longer. Is it possible to get a conversion with no liquidation when there is no significant assets ? Or how could I change the conversion back to a dismissal ?
Thank you

Attorney answers (2)

  1. Mark Markus

    Contributor Level 16

    Answered . Very difficult to do. The case likely would not have been converted to Chapter 7 if there were no assets. You don't state this but, reading between the lines, is the reason you don't want the Chapter 7 because you want to keep the assets of the corporation (such as its name, customer list, etc.)? If so, you should WANT the Chapter 7 because that is the only way you can purchase the assets without anyone suing you later for absconding with corporate assets that belong to the corporation's creditors.

    If that is what you want to do, you should consult with a business bankruptcy attorney who can advise you further. The best thing to do in that instance is to have a friend or family member purchase the assets and use them to start a new business or something that isn't in your name (to avoid successor liability issues). But I'm just taking a guess as to what you're really asking here.

    Mark J. Markus, Attorney at Law
    Handling exclusively bankruptcy law cases in California since 1991.
    http://www.bklaw.com/

  2. Adam Brooks Arnold

    Contributor Level 12

    Answered . I concur with my colleague that the reason for the conversion may have to do with assets of the corporation. Or, perhaps the chapter 11 case was not in compliance with the various laws, procedures and rules that govern these complex cases. In any instance, why would you be so concerned about the case being completed as a chapter 7 case if all you planned to do was dissolve the corporation anyways? If you attempted to file and complete your chapter 11 case without the assistance of a bankruptcy lawyer, I highly recommend that you consult with one now to discuss all of your questions and concerns.
    Good luck.

Related Topics

Debt

There are different types of debt, but all involve one person (the debtor) owing money to another (the creditor). Terms of repayment are governed by a contract.

Can't find what you're looking for? Ask a Lawyer

Get free answers from experienced attorneys.

 

Ask now

24,657 answers this week

2,988 attorneys answering

Ask a Lawyer

Get answers from top-rated lawyers.

  • It's FREE
  • It's easy
  • It's anonymous

24,657 answers this week

2,988 attorneys answering