adversary proceeding A lawsuit arising in or related to a bankruptcy case that is commenced by filing a complaint with the court.
automatic stay An injunction that automatically stops lawsuits, foreclosure, garnishments, and all collection activity against the debtor the moment a bankruptcy petition is filed.
bankruptcy A legal procedure for dealing with debt problems of individuals and businesses; specifically, a case filed under one of the chapters of title 11 of the United States Code (the Bankruptcy Code).
business bankruptcy A bankruptcy case in which the debtor is a business or an
individual involved in business and the debts are for business purposes.
bankruptcy estate All legal or equitable interests of the debtor in property at
the time of the bankruptcy filing. (The estate includes all property in which
the debtor has an interest, even if it is owned or held by another person.)
bankruptcy petition A formal request for the protection of the federal bankruptcy laws. (There is an official form for bankruptcy petitions.)
bankruptcy trustee A private individual or corporation appointed in all chapter
7, chapter 12, and chapter 13 cases to represent the interests of the bankruptcy
estate and the debtor's creditors.
Bankruptcy Code The informal name for title 11 of the United States Code (11 U.S.C. §§ 101 - 1330), the federal bankruptcy law.
chapter 7 The chapter of the Bankruptcy Code providing for "liquidation," ( i.e., the sale of a debtor's nonexempt property and the distribution of the proceeds to creditors.)
chapter 7 trustee A person appointed in a chapter 7 case to represent the interests of the bankruptcy estate and the unsecured creditors. (The trustee's responsibilities include reviewing the debtor's petition and schedules, liquidating the property of the estate, and making distributions to creditors. The trustee may also bring actions against creditors or the debtor to recover property of the bankruptcy estate.)
chapter 11
The chapter of the Bankruptcy Code providing (generally) for reorganization, usually involving a corporation or partnership. (A chapter 11 debtor usually proposes a plan of reorganization to keep its business alive and pay creditors over time. People in business or individuals can also seek relief in chapter 11.)
chapter 12
The chapter of the Bankruptcy Code providing for adjustment of debts of a "family farmer," or a "family fisherman" as those terms are defined in the Bankruptcy Code.
chapter 13 The chapter of the Bankruptcy Code providing for adjustment of debts of an individual with regular income. (Chapter 13 allows a debtor to keep property and pay debts over time, usually three to five years.)
chapter 13 trustee A person appointed to administer a chapter 13 case. (A chapter 13 trustee's responsibilities are similar to those of a chapter 7 trustee; however, a chapter 13 trustee has the additional responsibilities of overseeing the debtor's plan, receiving payments from debtors, and disbursing plan payments to creditors.)
chapter 15
Chapter 15 is a new chapter added to the Bankruptcy Code by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. It is the U.S. domestic adoption of the Model Law on Cross-Border Insolvency promulgated by the United Nations Commission on International Trade Law ("UNCITRAL") in 1997, and it replaces section 304 of the Bankruptcy Code. Because of the UNCITRAL source for chapter 15, the U.S. interpretation must be coordinated with the interpretation given by other countries that have adopted it as internal law to promote a uniform and coordinated legal regime for cross-border insolvency cases.
claim A creditor's assertion of a right to payment from a debtor or the debtor's property.
complaint The first or initiatory document in a lawsuit that notifies the court and the defendant of the grounds claimed by the plaintiff for an award of money or other relief against the defendant.
confirmation Approval of a plan of reorganization by a bankruptcy judge.
consumer debts Debts incurred for personal, as opposed to business, needs.
creditor A person to whom or business to which the debtor owes money or that claims to be owed money by the debtor.
debtor A person who has filed a petition for relief under the bankruptcy laws.
defendant An individual (or business) against whom a lawsuit is filed.
discharge A release of a debtor from personal liability for certain dischargeable debts. (A discharge releases a debtor from personal liability for certain debts known as dischargeable debts (defined below) and prevents the creditors owed those debts from taking any action against the debtor or the debtor's property to collect the debts. The discharge also prohibits creditors from communicating with the debtor regarding the debt, including telephone calls, letters, and personal contact.)
dischargeable debt A debt for which the Bankruptcy Code allows the debtor's personal liability to be eliminated.
equity The value of a debtor's interest in property that remains after liens and other creditors' interests are considered. (Example: If a house valued at $60,000 is subject to a $30,000 mortgage, there is $30,000 of equity.)
exempt A description of any property that a debtor may prevent creditors from recovering.
exemption Property that the Bankruptcy Code or applicable state law permits a debtor to keep from creditors.
exempt property Property or value in property that a debtor is allowed to retain, free from the claims of creditors who do not have liens.
joint petition One bankruptcy petition filed by a husband and wife together.
lien A charge upon specific property designed to secure payment of a debt or performance of an obligation.
liquidation A sale of a debtor's property with the proceeds to be used for the benefit of creditors.
liquidated claim A creditor's claim for a fixed amount of money.
Motion to lift the automatic stay A request by a creditor to allow the creditor to take an action against a debtor or the debtor's property that would otherwise be prohibited by the automatic stay.
no-asset case A chapter 7 case where there are no assets available to satisfy any portion of the creditors' unsecured claims.
nondischargeable debt A debt that cannot be eliminated in bankruptcy.
objection to discharge A trustee's or creditor's objection to the debtor's being released from personal liability for certain dischargeable debts.
plan A debtor's detailed description of how the debtor proposes to pay creditors' claims over a fixed period of time.
plaintiff A person or business that files a formal complaint with the court.
341 meeting A meeting of creditors at which the debtor is questioned under oath by creditors, a trustee, examiner, or the United States trustee about his/her financial affairs.
transfer Any mode or means by which a debtor disposes of or parts with his/her property.
trustee The representative of the bankruptcy estate who exercises statutory powers, principally for the benefit of the unsecured creditors, under the general supervision of the court and the direct supervision of the United States trustee or Bankruptcy Administrator.
typing service A business not authorized to practice law that prepares bankruptcy petitions.
United States trustee An officer of the Justice Department responsible for supervising the administration of bankruptcy cases, estates, and trustees, monitoring plans and disclosure statements, monitoring creditors' committees, monitoring fee applications, and performing other statutory duties.
under secured claim A debt secured by property that is worth less than the amount of the debt.
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