Legal Question in Bankruptcy in Connecticut

Should we accept offer to purchase severance claim?

My wife worked at Ames who filed for Bankruptcy under Chapter 11. She received 40% of her severance package after she was terminated. She just got paperwork offering to purchase her severance claim for 40% of the remainder of the severance package. She would get $463.30 but be releasing $694.94 of the remainder of the claim and would not be eligible for any more. If she does not accept she may get anywhere from nothing to all of the severance remaining. Should she accept the offer, or roll the dice and wait? Thank You!


Asked on 12/02/03, 5:16 pm

1 Answer from Attorneys
Thomas Noonan Attorney Thomas F. Noonan L.L.C.

Re: Should we accept offer to purchase severance claim?

In response to your question, I cannot tell you to role the dice either way. As this is a chapter 11, there may be a plan for payments to creditors and employees. You should have gotten information on the plan. Unless I know what the plan for re-orgization contains or if the plan ignores the issue, or provides for payment to employees that the employer is not abiding by the plan, I can't advise you on the take it and leave situation she has been given. If I were you. I would get the information in the bankruptcy or talk to an attorney where you live and have the attorney review the alternatives. As you are only dealing with about 500.00, It may not be any financial benefit to you because of Attorney's fees, court costs and other costs you may have to pay. It is your and your wife's decision to throw the dice or research the details before you decide. Tom Noonan

Read more
Answered on 12/04/03, 10:58 am


Related Questions & Answers

More Bankruptcy Law questions and answers in Connecticut