Legal Question in Bankruptcy in Massachusetts
Hi, I filled for bankrupcy 7 and have been discharged already. Now my lawyer is saying that the trustee is going after my stock options. My lawyer is saying that the trustee is asking for $8000. My lawyer will counter offer $4000. Is this possible or legal?
Thank you
2 Answers from Attorneys
Absolutely legal, unfortunately. The discharge is totally separate from the trustee collecting unprotected assets and making a distribution to the creditors. Sorry.
I wrote about this quite some time ago. http://www.bankruptcylawnetwork.com/2007/10/11/bankruptcy-discharge-does-not-close-the-case/
When you file a Chapter 7 case, all assets become property of the Estate (administered by the Trustee) unless those assets can be exempted. This is a conversation that you should have had with your lawyer before filing the case - what assets are exposed and could possibly be lost to the Trustee. You are not required to bargain with the Trustee, however. You can simply let the Trustee have the options to sell and then use the proceeds to pay creditor. If you wish to get your options back, on the other hand, then you (or your attorney) and the Trustee need to reach an agreement and you will need to pay the Trustee to "buy out" your options. Consider this a partial repayment of your debts. Let me know if you have additional questions.
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Bankruptcy Law: (small business....about 1 million a year in sales) Background... Asked 12/02/10, 12:09 am in United States Massachusetts Bankruptcy Law