Exam 38: Bankruptcy

Which of the following is both a prejudgment and a postjudgment remedy for a creditor?

Able gets a judgment against Baker in state court for $50,000 on July 1.On July 15,Baker files a bankruptcy petition under Chapter 7.Which of the following is true?

In a Chapter 7 proceeding,an unsecured creditor who files a claim with the court after the deadline because he is too busy planning and going on a vacation would be totally unable to collect.

The doctrine of subordination of claims might result in two unsecured creditors getting unequal proportions of their debts paid.

A debtor may not receive a discharge under Chapter 7 if he or she received a Chapter 13 discharge within the past six years in most cases.

For bankruptcy purposes,insolvency means that debts are greater than assets.

Edward's Excursions Inc.filed for Chapter 7 bankruptcy.It has $80,000 in equity and has the following debts outstanding: $50,000 to Arthur secured by a boat worth $25,000. $30,000 to Bradley secured by a truck worth $30,000. $20,000 to Clarence unsecured. The month before Edward closed and filed for bankruptcy,his employees earned $4,000 but did not get paid.Edward's owes $4,000 in back taxes.In the process of administering the estate,the trustee paid $5,000 in attorney fees.In what order will these claims be paid?

A trustee under a Chapter 11 or 13 proceeding performs the same duties as a Chapter 7 trustee.

Section 522 of the Bankruptcy Code exempts specified property of an individual debtor from bankruptcy.What are some of these exemptions?

The court has the sole right to accept or reject a Chapter 11 plan of reorganization.

After reorganization,all debts are forgiven.

Duties of a trustee in a case under Chapter 11 include all but which of the following?

What is the trustee in bankruptcy and what is the role of the trustee in bankruptcy proceedings? What powers and duties does the trustee have and what sorts of transactions the trustee can attack?

A composition would bind to the settlement all of debtor's creditors.

A writ of execution is issued after a judgment against the debtor is entered in court.

Any debtors may seek relief under Chapter 7 of the Bankruptcy Code.

Chapter 5 involves liquidation,whereas Chapters 7,11,12,and 13 involve reorganization and adjustment of debts.

Garnishment is one form of prejudgment remedy.

Non-bankruptcy compromises to give debtors relief while protecting the rights of creditors include all of the following except:

In March,Margaret made a loan to Pete for $10,000.Three months later,she began to hear rumors about Pete's failing financial condition.When in July,Pete asked her to loan him an additional $2,000 to buy inventory,Margaret required a security interest in the inventory and also demanded that Pete secure the first loan with his personal automobile.In September,Pete filed for bankruptcy.Will these security interests stand up?