Asked by Reginald Louis on May 25, 2024
Verified
Which of the following is false regarding bankruptcy proceedings?
A) Some type of payment plan is created and approved, usually by the creditors and the court.
B) Debts remaining after the plan is carried out are usually discharged.
C) Bankruptcy proceedings start with a finding of insolvency.
D) All bankruptcy cases begin with a filing of petition for bankruptcy.
E) The court determines whether an order of relief should be granted.
Bankruptcy Proceedings
The legal process through which individuals or businesses unable to meet their financial obligations seek relief from their debts.
Payment Plan
A payment plan is an agreement to pay off an owed amount over a designated period, through specified number of installments.
Order Of Relief
A court order that provides a debtor protection from creditors under bankruptcy proceedings, initiating the automatic stay.
- Acquire knowledge of the essential processes in bankruptcy cases.
Verified Answer
SS
Sabah SidaouiMay 25, 2024
Final Answer :
C
Explanation :
Bankruptcy proceedings do not always start with a finding of insolvency. Insolvency is a financial state where one's liabilities exceed their assets, but not all types of bankruptcy require a finding of insolvency to initiate proceedings. For example, in some jurisdictions, voluntary bankruptcy filings do not require the debtor to be insolvent.
Learning Objectives
- Acquire knowledge of the essential processes in bankruptcy cases.