Business Law- Chapter 28 Flashcards Preview

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Flashcards in Business Law- Chapter 28 Deck (40):
1

Fresh Start

The goal of federal bankruptcy law, to grant and debtor relief from some of her burdensome debts, while protecting creditors by requiring the debtor to pay more of his or her debts that would otherwise have been required prior to the 2005 act.

2

Bankruptcy Abuse Prevention and Consumer Protection Act of 2005

A federal act that substantially amended federal bankruptcy law. This act makes it more difficult for debtors to file for bankruptcy and have their unpaid debts discharged.

3

Bankruptcy Code

The name given to federal bankruptcy law, as amended.

4

Bankruptcy Reform Act of 1978

A federal act that substantially changed federal bankruptcy law. The act made it easier for debtors to file for bankruptcy and have their unpaid debts discharged. This act was considered debtor friendly.

5

Bankruptcy Courts

Special federal courts that hear and and decide bankruptcy cases.

6

U.S. Trustee

A federal government official who is responsible for handling and supervising many of the administrative tasks of a bankruptcy case.

7

Petition

A document filed with a bankruptcy court that starts a bankruptcy proceeding.

8

Voluntary Petition

A petition filed by a debtor that states that the debtor has debts.

9

Involuntary Petition

A petition filed by creditors of a debtor that alleges that the debtor is not paying her debts as they become due.

10

Order for Relief

An order that occurs upon the filing of either a voluntry petition of an unchallenged involuntary petition or an order that is granted after a trial of a challenged involuntary petition.

11

Meeting of the Creditors

A meeting of the creditors in a bankruptcy case that must occur within a reasonable time after an order for relief. The debtor must appear at this meeting.

12

Proof of Claim

A document required to be filed by a creditor that states the amount of her claim against the debtor.

13

Proof of Interest

A document required to be filed by an equity security holder that states the amount of her interest against the debtor.

14

Trustee

A legal representative of the debtor's estate.

15

Automatic Stay

The suspension of certain legal actions by creditors against a debtor or the debtor's property.

16

Discharge

A court order that relieves a debtor of the legal liability to pay her debs that were not paid in the bankruptcy proceeding.

17

Reaffirmation Agreement

An agreement entered into by a debtor with a creditor prior to discharge, where by the debtor agrees to pay the creditor a debt that would otherwise be discharged in bankruptcy. Certain requirements must be met for a reaffirmation agreement to be enforced.

18

Bankruptcy Estate

The debtor's property and earnings that comprise the estate of a bankruptcy proceeding.

19

Exempt Property

Property that may be retained by the debtor pursuant to federal or state lay that does not become part of the bankruptcy estate.

20

Homestead Exemption

Equity in a debtor's home that the debtor is permitted to retain.

21

Fraudulent Transfer

A transfer of a debtor's property or an obligation incurred by a debtor within 2 years for the filing of a petition where the debtor has actual intent to hinder, delay, or defraud a creditor or the debtor received less than a reasonable equivalent in value, and the debtor was insolvent or unable to pay at the time the transfer was made or the obligation was incurred.

22

Chapter 7-Liquidation

A form of bankruptcy in which the debtor's nonexempt property is sold for cash, the case is distributed to the creditors and any unpaid debts are discharged.

23

Abusive Filing

A chapter 7 filing that is found to be an abuse of Chapter 7 liquidation bankruptcy. In such a case, the court can dismiss the case or convert the case to a Chapter 13 or Chapter 11 proceeding, with the debtor's consent.

24

State Median Income

For any size family, income for which half of the state's families of this size have incomes above this figure and half of the state's families of this size have incomes less than this figure.

25

Mean Test

A new test added by the 2005 act that applies to debtors who have family incomes that exceed the state's median income for families of the same size.

26

Chapter 7 Discharge

The termination of the legal duty of an individual debtor to pay unsecured debts that remain unpaid upon the completion of a Chapter 7 proceeding.

27

Chapter 13- Adjustment of Debts of an Individual with Regular Income

A rehabilitation form of bankruptcy that permits bankruptcy courts to supervise the debtor's plan for the payment of unpaid debts in installments over the plan period.

28

Chapter 13 Discharge

A discharge in a Chapter 13 case that is granted to the debtor after the debtor's plan of payment is completed (which could be up to three or up to 5 years).

29

Chapter 11- reorganization

A bankruptcy method that allows the reorganization of the debtor's financial affairs under the supervision of the bankruptcy court.

30

Debtor-in-possession

A debtor who is left in place to operate the business during the reorganization proceeding.

31

Creditors' Committee

A committee of unsecured creditors that is appointed by the court to represent the class of unsecured claims. The court also appoint committees for secured creditors and for equity holders.

32

Executory Contract or Unexpired Lease

A contract or lease that has not been fully performed. With the bankruptcy court's approval, a debtor may reject executory contracts and unexpired leases in bankruptcy.

33

Plan of Reorganization

A plan that sets forth a proposed new capital structure for a debtor to assume when it emerges from Chapter 11 reorganization bankruptcy.

34

Confirmation

The bankruptcy court's approval of a plan of reorganization.

35

Acceptance Method

A method whereby the court confirms a plan of reorganization if the creditors accept the plan and if other requirements are met.

36

Cram-down Provision

A provision whereby the court confirms a plan of reorganization over an objecting class of creditors if certain requirements are met.

37

Chapter 12- adjustment of debts of a family farmer or fisherman with regular income.

A form of bankruptcy reorganization permitted to be used by family farmers and family fisherman.

38

Family Farmer

An individual, a corporation, or a partnership that engages in farming operations and meets the requirements for filing for a Chapter 12 proceeding.

39

Family Fisherman

An individual, a corporation, or a partnership that engages in commercial fishing operations and meets the requirements for filing for a Chapter 12 proceeding.

40

Chapter 12 Discharge

A discharge in a Chapter 12 case that is granted to a family farmer or a family fisherman debtor after the debtor's plan of payment is completed.