Protection of creditors' interests in bankruptcy cases of legal entities
A bankruptcy case is of interest to creditors with claims of UAH 500,000 or more, whose debtors evade payment of their financial obligations. In this case, several creditors can coordinate their actions and distribute the costs associated with the insolvency (bankruptcy) case of a legal entity.
The debtor's dishonesty, attempts to hide or withdraw property, and restrictions introduced within the framework of enforcement proceedings regarding the seizure and collection of funds significantly complicate the satisfaction of creditors' claims.
The case of insolvency (bankruptcy) of a legal entity allows the personally interest of the owners and managers of the debtor to pay their debts, gain control over the debtor, return the "withdrawn" property, the debtor's assets, at the expense of which satisfy the creditor's requirements.
Sometimes creditors are intimidated by the costs involved in initiating insolvency proceedings and the length of their proceedings..
In this case, it should be taken into account that an analysis of the debtor's assets and cash flows at the stage of enforcement proceedings will help accelerate the bankruptcy procedure.
Tracing the assets of owners and executives, as well as assessing the possibility of returning withdrawn assets, will make it possible to develop an action plan in the bankruptcy case, and determine the expediency of its implementation before the opening of bankruptcy proceedings.
If the enforcement proceedings are accompanied by our specialists, such an analysis will be easier to conduct.
Expenses incurred within the framework of a bankruptcy case may be included in the register of creditors' claims and paid at the debtor's expense out of turn.
Thus, if the debt cannot be collected within the framework of enforcement proceedings, it is worth investigating the expediency of opening insolvency (bankruptcy) proceedings against your debtor.
Ignoring the ability to collect one`s claims within the framework of a bankruptcy case can lead to a loss of time, which in turn can make it difficult to recover the debtor's property, make it difficult to hold the debtor's manager and owners jointly or severally liable, and leave the debtor's unscrupulous managers without proper punishment.
Insolvency is the inability of a debtor to timely fulfill monetary obligations to creditors without applying the procedures provided for by the Code of Ukraine on Bankruptcy Procedures.
The Bankruptcy Code of Ukraine defines the following procedures (stages of consideration) in insolvency cases for legal entities:
- Pre-trial rehabilitation of the debtor.
- Property disposal.
- Rehabilitation plan.
- Bankruptcy – liquidation.
The lawyers and arbitration managers who are part of our team have more than ten years of experience in matters of restoring the solvency of debtors or declaring them bankrupt and can provide the following services to protect the interests of the creditor:
- Preparation and submission of an application for the initiation of insolvency (bankruptcy) proceedings.
- Preparation and submission of an application with creditor claims.
- Representation of creditors at creditors' meetings and creditors' committee meetings.
- Protection of secured and unsecured creditors.
- Representation of creditors' interests in court.
- Development and submission of an application for the removal of the manager from the management of the debtor.
- Preparation and submission of applications to hold the debtor's manager jointly and severally liable.
- Preparation and submission of an application to hold owners (participants, shareholders), managers and other persons to subsidiary responsibility.
- Appointment in insolvency cases of a property administrator, rehabilitation manager, restructuring manager, sales manager, liquidator.
- Suspension, replacement of the arbitration manager in insolvency cases.
- Development of a rehabilitation plan to satisfy creditors' claims and simultaneously restore the debtor's economic activities.
The professional services of our lawyers and arbitrators will allow you to fully utilize all the advantages of an insolvency (bankruptcy) case.
Advantages of a bankruptcy case for a legal entity for the creditor:
- Initiation of bankruptcy proceedings in the presence of undisputed claims of creditors, without the need to collect the debt in court and initiate enforcement proceedings.
- Increased control over the debtor's property status.
- The ability to refute unreasonable claims of other creditors against the debtor.
- Suspension of managers and owners from the management and disposal of the debtor's property.
- Possibility of applying measures to secure creditors' claims.
- Special grounds for declaring transactions invalid for the return of the debtor's property.
- Obtaining complete information about the debtor's financial situation.
- The ability to satisfy your claims by holding the debtor's manager jointly and severally liable.
- The ability to satisfy one's claims by holding owners, shareholders, and other persons who caused losses to the debtor by their actions liable.
- Restoration, if necessary, of accounting and tax records for the purpose of tracing and returning the debtor's property.
- Collection of debtor's receivables.
Current legislation provides powerful and effective tools for debt collection and holding unscrupulous managers, owners, and beneficiaries of the debtor accountable.