Many business and commercial bankruptcies in Rockland County and elsewhere end up with the assets of the enterprise being sold to an investor who intends to reinvigorate the company and turn it into a profitable enterprise. The lure of purchasing a bankrupt company is the reduced price of the assets. On the other hand, rehabbing a bankrupt company can be very expensive and risky.
Many New Yorkers probably have had to deal with medical expenses even after a relatively minor illness or common course of treatment. Particularly for those who do not have the best health insurance, these bills can pile up quickly, as some residents of Rockland or Garnerville may have plans leave them responsible for a large deductible, to the tune of thousands of dollars.
When a resident of Rockland County considers filing a bankruptcy petition, one of the crucial decisions is whether to file a petition for discharge under Chapter 7 or a petition for reorganization under Chapter 13. A decision to seek discharge under Chapter 7 can often produce what is called a "no asset" case. This is a case where the debtor has no assets that can be liquidated to pay the claims of unsecured creditors.
Let's imagine that you own and operate a business in Rockland County. You have a customer who owes you money for goods that were bought at various times during the last year. You learn that the customer is experiencing financial difficulties and may have trouble paying his debts. You take the obvious action and ask the customer for payment. The customer pays one-third of what he owes and promises more later. Instead of "more," however, the customer files a bankruptcy petition two weeks later. Bad news, but at least you were paid some of what the customer owes. You shrug and think things could be worse. You file your notice of claim for the balance owed to you and wait. But instead of receiving money from the bankruptcy trustee, you receive a federal court complaint seeking to recover the money paid to you before the bankruptcy. How can this be?