Legal Question in Bankruptcy in Virginia
Uncashed check
5+ months ago, I loaned someone some money and as security they gave me personal checks totaling the amount of the loan. Recently they filed Ch 13 listing me as a creditor and still owing part of the loan. Will I violate the stay by depositing one of the checks now post petition?
Asked on 8/25/08, 8:48 am
1 Answer from Attorneys
Daniel Press
Chung & Press, P.C.
Re: Uncashed check
Presenting the check for deposit is not a violation of the stay. However, it is likely that a court would find that if the check is honored, retaining the funds would violate the stay, or at a minimum would be recoverable as an unauthorized post-petition transfer.
Answered on 8/25/08, 9:09 am
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