No business owner wants to file for bankruptcy. You expect your business to be successful in the long term and are willing to do everything you can to keep your doors open and your employees working. But sometimes, circumstances outside of your control can cause your business to struggle more than you ever expected. When this happens, filing for bankruptcy can make your professional life easier. But can bankruptcy help you avoid litigation and the stress that comes from lawsuits? Not always. There are situations where litigation will be necessary, and your Milwaukee business bankruptcy attorneys want you to be prepared.
Common Circumstances When Litigation Is Needed
Though every case is unique, there are some instances when your bankruptcy attorney will have to represent you in litigation as part of the process. Here are some of the most common instances you’ll want to watch for.
Questions Over the Dischargeability of Debts
Depending on the type of bankruptcy you file, some of your debts may be completely discharged by the bankruptcy court. But that doesn’t guarantee that those debts will disappear. In some cases, the bankruptcy trustee may question whether certain business debts are eligible for discharge. During this period, they can litigate and push for a different resolution, typically involving you paying back what you owe.
Your attorney will be able to represent you if the court decides to litigate.
Questions Over the Right to Payment
The bankruptcy court can also litigate against your creditors, questioning their right to payment on certain debts. This type of litigation doesn’t usually impact you. Instead, it impacts the bankruptcy court and the creditors trying to collect payment.
Questions Over Exemptions
You may be entitled to claim certain exemptions when you file for bankruptcy. These exemptions could help you keep certain assets and reduce the risk of loss when you file. If the trustee questions the exemption, you may need to litigate to prove the validity of your claim. Your Milwaukee business bankruptcy attorney will be able to represent you if needed.
Existing or Pending Lawsuits
If your business is already facing a lawsuit at the time of your bankruptcy filing, you may still need to follow through with the lawsuit. Those prior claims could still be valid. But in many instances, your lawsuits will be heard by the bankruptcy court rather than another district. This can work in your favor since the court understands your situation more than another judge would.
If you’re worried about existing lawsuits, be sure to disclose them to your Milwaukee business bankruptcy attorney as soon as possible. The sooner they’re made aware, the easier it will be to determine how those lawsuits may impact your case and what next steps you’ll need to take to reach a satisfactory resolution.
How a Milwaukee Business Bankruptcy Attorney Can Help
Whether you’re worried about litigation or feel confident that your business bankruptcy will largely be simple and straightforward, working with an experienced attorney is always a good idea. Your bankruptcy attorney can help in the following ways:
- They’ll answer all of your business bankruptcy questions.
- They can give you advice to help you navigate the process.
- They’ll ensure that all paperwork and documentation is submitted correctly and on time.
- They can argue on your behalf if the trustee petitions for more than is fair.
- They can help you choose the right type of bankruptcy for your business and your goals.
The right attorney can make all the difference in your case, but be sure to work with a business bankruptcy attorney who is familiar with situations like yours. This way, you’ll have an expert you can rely on who is also familiar with your industry and your concerns.
Let Kerkman and Dunn Help With Your Bankruptcy
If you’re considering filing for business bankruptcy, set yourself up for success from the very beginning. At Kerkman and Dunn, our team is here to help. Contact us today to schedule a free consultation.
