Legal Question in Banking Law in California
Bankruptcy..what to do if your owed?
I was doing business with Sherwood Shutter Corp., on 9/19/07 I put 50% down on my order and was told it would take 90 days for delivery. on 11/09/07 I received notification from the Sales Rep that the company went bankrupt and is supposedly in court ordered closure. I was told to call the court appointed bankruptcy trustee to get info on how to file for a claim.
When I called the number I spoke to a person who told me that Sherwood Shutters Corp received a court order shut down on 10/04/07.
When I looked on the internet I saw an article on ''Business Week.Com'' that Sherwood Shutters filed for Chapter 11 with the Bankruptcy courts for the Central District of California on June 8th 2007.
My question is a 2 parter.
1) Since Sherwood Shutters filed their paper work for chapter 11 on 6/8/07, and I placed my order on 9/19/07 couldn't this be considered a form of fraud? Since this company knew that they might not be able to fill the order wouldn't it be illegal/fraudulent for them to keep on taking orders and money?
2) What are my chances of getting my money back or recourse since the company is shut down and in court ordered bankruptcy?
Thank You!
James
3 Answers from Attorneys
Re: Bankruptcy..what to do if your owed?
Generally, when a company files for a Chapter 11 bankruptcy, it continues to do business. Based on your description, it appears that the debtor continued to operate under Chapter 11, but was not successful, and was ordered to cease operations.
Without reviewing your paperwork, it is not possible to give you a legal opinion regarding your recourse. However, since you gave a deposit to the debtor during the bankruptcy, it is worth researching whether you can reclaim your entire deposit. If you had given your deposit prior to bankruptcy, you would just be one of many unsecured creditors.
Re: Bankruptcy..what to do if your owed?
Generally, when a company files for a Chapter 11 bankruptcy, it continues to do business. Based on your description, it appears that the debtor continued to operate under Chapter 11, but was not successful, and was ordered to cease operations.
Without reviewing your paperwork, it is not possible to give you a legal opinion regarding your recourse. However, since you gave a deposit to the debtor during the bankruptcy, it is worth researching whether you can reclaim your entire deposit. If you had given your deposit prior to bankruptcy, you would just be one of many unsecured creditors.
Re: Bankruptcy..what to do if your owed?
Generally, when a company files for a Chapter 11 bankruptcy, it continues to do business. Based on your description, it appears that the debtor continued to operate under Chapter 11, but was not successful, and was ordered to cease operations.
Without reviewing your paperwork, it is not possible to give you a legal opinion regarding your recourse. However, since you gave a deposit to the debtor during the bankruptcy, it is worth researching whether you can reclaim your entire deposit. If you had given your deposit prior to bankruptcy, you would just be one of many unsecured creditors.
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