Working With the Bankruptcy Trustee

 

Filing for Chapter 7 bankruptcy means that you'll be dealing with a "bankruptcy trustee" who will be assigned to handle your case. The trustee's job is to gather all non-exempt property you own into the "bankruptcy estate" to determine what (if anything) can be sold and the proceeds distributed to your unsecured creditors. In most cases, there's nothing left — "no-asset" cases make up more than 90% of consumer chapter 7 cases — but the trustee will be looking.

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When you file for bankruptcy, a “Trustee” is appointed to your case.

It’s essential to understand the role of the trustee and who they “work” for.

Although the court appoints the trustee, the trustee’s job is to get as much property as possible to be sold and the proceeds distributed equitably to your unsecured creditors, according to “priority” rules — determining who gets paid first — under federal and state law.

Almost all of your dealings with the bankruptcy court will be with the trustee assigned to your administering your case, not the bankruptcy judge.

The bankruptcy judge is only there to rule on disputed legal issues and issue your “discharge” order — the piece of paper that officially cancels your debts upon completing a successful filing — which is the ultimate goal of bankruptcy.

What does the Trustee do in a Chapter 7 case?

Bankruptcy Code § 323 states that the trustee is the representative of the “bankruptcy estate” with the capacity to sue and be sued.

The Bankruptcy Code defines the trustee’s duties and obligations:

  • Section 704 defines the statutory duties of the trustee in a Chapter 7 bankruptcy case, and, under § 704, the primary task of the trustee is toreduce to money the property of the estate for which such trustee serves” that is: to “liquidate” the assets and distribute the proceeds to your creditors. (Note this the job in Chapter 7 (“liquidation”) bankruptcy is different than it is in Chapter 13 (“pay over five years”) bankruptcy. 
  • Other relevant duties include ensuring that the debtor performs their intention (regarding secured debts) as specified in § 521(a)(2)(B) (See debtor’s “statement of intention” as provided in Form ____),
  • investigate the financial affairs of the debtor (see, “What is a 341 meeting?”),
  • and “if advisable, oppose the discharge of the debtor.” (see “What kinds of debts can be discharged in bankruptcy?” and “Things that might make your bankruptcy case fail.")

How Are Trustees Paid?

Bankruptcy Code § 326 says that a trustee’s compensation is based upon a percentage of the property of the estate the trustee administers. As a result, a trustee has a financial incentive to maximize the property of the estate. Consequently, discussions or disputes with a Chapter 7 trustee will primarily focus on what is property of the estate.

How Trustees Can Increase the size of the “Bankruptcy Estate.”

The whole point of bankruptcy is ensuring everyone gets their rightful share of the “pie” when there’s not enough pie. Or, to put it a more legal way: to provide an orderly distribution of available assets (“the pie”) to all creditors based on the priority outlined in federal bankruptcy law. 

The trustee’s job is to make that “pie” as large as legally possible. What follows is a list of ways they can try to do that.

Undoing “Preferential Transfers” That You Made Before Filing

One tool the trustee has is the authority to undo any “preferential transfers.” That is, any money or property you transferred to someone else just before (generally up to 180 days before) filing bankruptcy.

Under this power, the trustee will be very interested in undoing any recent repayments of debts you made to your relatives or friends just before you filed for bankruptcy, as these are called a “preference.”

The trustee can reverse these transactions (i.e., claw the money back) and reclaim it for the “bankruptcy estate” because, by repaying these people before just going bankrupt, you have “preferred” some people you owe money to over others -- and bankruptcy does not allow this, because bankruptcy law has strict rules about who gets priority when it comes to claiming any available assets you may have.

Wiping out invalid liens on your property to increase equity to be distributed to creditors

Suppose you own a house with a second mortgage or have several liens on your property. In that case, the trustee may look to “void” some of those liens if doing so will increase your home equity to the point that it is no longer fully protected by applicable homestead exemption laws. 

Who Are the Trustees for Pennsylvania Western District Bankruptcy Court?

To find the contact information for trustees in your state who handle Chapter 7 cases:

Click here for a list of Chapter 7 trustees for Pennsylvania from the US Department of Justice.

Once you bring up this list, find the Pennsylvania trustees for the Pennsylvania Western District Bankruptcy Court.

PENNSYLVANIA

 

Note: The individuals listed are private parties, not government employees.

 

 

TRUSTEE(S) COVERING THE EASTERN DISTRICT OF PENNSYLVANIA

 

Terry P. Dershaw
P.O. Box 556
Warminster, PA 18974 -0632
E-mail: dershaw@gmail.com
Phone: (484) 897-0341

 

Lynn E. Feldman
2310 Walbert Avenue, Suite 103
Allentown, PA 18104
Phone: (610) 530-9285
Fax: (610) 437-7011

 

Bonnie B. Finkel
P.O. box 1710
Cherry Hill, NJ 08034 -0091
E-mail: finkeltrustee@comcast.net
Phone: (856)216-1278

 

Robert H. Holber
41 East Front Street
Media, PA 19063 -2807
E-mail: rholber@holber.com
Phone: (610)565-5463

 

Gary F. Seitz
1628 John F. Kennedy Boulevard
8 Penn Center, Suite 1901
Philadelphia, PA 19103
Phone: (215) 238-0011
Fax: (215) 238-0016

 

Christine C. Shubert
821 Wesley Avenue
Ocean City, NJ 08226
Phone: (609) 923-7184

TRUSTEE(S) COVERING THE MIDDLE DISTRICT OF PENNSYLVANIA

 

Steven M. Carr
119 East Market Street
York, PA 17401
E-mail: Carr20@aol.com .com
Phone: (717)843-8968

 

Lawrence G. Frank
100 Aspen Drive
Dillsburg, PA 17019
E-mail: lawrencegfrank@gmail.com
Phone: (717)234-7455
Fax: (717)432-9065

 

Kara K Gendron
125 State Street
Harrisburg, PA 17101
E-mail: karagendron@gmail.com
Phone: (717) 232-6650

 

Leon P. Haller
1719 North Front Street
Harrisburg, PA 17102
E-mail: lhaller@pkh.com
Phone: (717)234-4178

 

John J. Martin
1022 Court Street
Honesdale, PA 18431
E-mail: jmartin@martin-law.net
Phone: (570)253-6899

 

Lisa A. Rynard
240 Broad Street
Montoursville, PA 17754
E-mail: larynard@larynardlaw.com
Phone: (570) 505-3289

 

Jill M. Spott
108 North Abington Road
Clarks Summit, PA 18411
E-mail: jspottesq@sheilslaw.com
Phone: (570) 587-2600

 

Lawrence V. Young
135 North George Street
York, PA 17401
E-mail: lyoung@cgalaw.com
Phone: (717)848-4900

TRUSTEE(S) COVERING THE WESTERN DISTRICT OF PENNSYLVANIA

 

Eric E. Bononi
20 N. Pennsylvania Avenue
Greensburg, PA 15601
E-mail: eric@bononilaw.com
Phone: (724) 832-2499

 

Natalie A. Cardiello
107 Huron Drive
Carnegie, PA 15106
E-mail: ncardiello@cardiello-law.com
Phone: (412) 276-4043

 

Rosemary C. Crawford
P.O. Box 355
Allison Park, PA 15101
E-mail: crawfordmcdonald@aol.com
Phone: (724)443-4757

 

John C. Melaragno
502 W. 7th Street
Erie, PA 16502
E-mail: johnm@mplegal.com
Phone: (814)459-5557

 

Tamera Ochs Rothschild
318 West Spring Street
Titusville, PA 16354
E-mail: trothschild@gmx.com
Phone: (814)827-2760

 

Jeffrey J. Sikirica
121 Northbrook Drive
Pine Township
Gibsonia, PA 15044
E-mail: trusteesikirica@zoominternet.net
Phone: (724) 625-2566
Fax: (724) 625-4611

 

Robert H. Slone
223 South Maple Avenue
Greensburg, PA 15601
E-mail: robertslone223@gmail.com
Phone: (724) 834-2990
Fax: (724) 834-1250

 

Joseph B. Spero
3213 West 26th Street
Erie, PA 16506
E-mail: jbspero@neohio.twcbc.com
Phone: (814)836-1011
Fax: (814)836-1140

 

Lisa M. Swope
219 South Center Street
P.O. Box 270
Ebensburg, PA 15931
E-mail: lms@nsslawfirm.com
Phone: (814)472-7151

 

Pamela J. Wilson
810 Vermont Avenue
Pittsburgh, PA 15234
E-mail: pwilson@pjwlaw.net
Phone: (412) 341-4323
Fax: (412) 341-2621

 

Charles O. Zebley, Jr.
18 Mill Street Square
P. O. Box 2124
Uniontown, PA 15401
E-mail: COZ@Zeblaw.com
Phone: (724) 439-9200




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Jurisdictional relevance: US

Legal Consumer - Johnstown, PALaw. The content of this article pertains to all US states and counties.