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Excerpts from
Bankruptcy Basics
A Public Information Series of the Bankruptcy Judges Division
Administrative Office of the United States Courts
APRIL 2004
Revised Second Edition

Contents

Introduction

The Discharge in Bankruptcy

Chapter 7. Liquidation Under the Bankruptcy Code

Chapter 13. Individual Debt Adjustment

Chapter 11. Reorganization Under the Bankruptcy Code

Chapter 12. Family Farmer Bankruptcy

Chapter 9. Municipality Bankruptcy

SIPA. Securities Investor Protection Act

Bankruptcy Terminology

A - B

C - D

E - L

M - R

S - V


Bankruptcy BASICS

Bankruptcy Terminology   A - B

Most debtors who file bankruptcy, and many of their creditors, know very little about the bankruptcy process. The Public Information Series of the Bankruptcy Judges Division is designed to provide debtors, credi- tors, judiciary employees, and the general public with a basic explanation of bankruptcy and how it works. The series features eight pamphlets that discuss chapter 7 (liquidation), chapter 13 (adjustment of debts of an individual with regular income), chapter 12 (adjustment of debts of a family farmer), chapter 11 (reorganization), chapter 9 (adjustment of debts of a municipality), SIPA (the Securities Investor Protection Act), the bankruptcy discharge, and bankruptcy terminology. This pamphlet on bankruptcy terminology explains, in layman's terms, many of the legal terms that are used in cases filed under the Bankruptcy Code.

ADVERSARY PROCEEDING
A lawsuit arising in or related to a bankruptcy case that is commenced by filing a complaint with the bankruptcy court.

ASSUME
An agreement to continue performing duties under a contract or lease.

AUTOMATIC STAY
An injunction that automatically stops lawsuits, foreclosure, garnishments, and all collection activity against the debtor the moment a bankruptcy petition is filed.

BANKRUPTCY
A legal procedure for dealing with debt problems of individuals and businesses; specifically, a case filed under one of the chapters of title 11 of the United States Code (the Bankruptcy Code).

BANKRUPTCY ADMINISTRATOR
An officer of the judiciary serving in the judicial districts of Alabama and North Carolina who, like the United States trustee, is responsible for supervising the administration of bankruptcy cases, estates, and trustees, monitoring plans and disclosure statements, monitoring creditors' committees, monitoring fee applications, and performing other statutory duties.

BANKRUPTCY CODE
The informal name for title 11 of the United States Code (11 U.S.C. 101-1330), the federal bankruptcy law.

BANKRUPTCY COURT
The bankruptcy judges in regular active service in each district; a unit of the district court.

BANKRUPTCY ESTATE
All legal or equitable interests of the debtor in property at the time of the bankruptcy filing. (The estate includes all property in which the debtor has an interest, even if it is owned or held by another person.)

BANKRUPTCY JUDGE
A judicial officer of the United States district court who is the court official with decision-making power over federal bankruptcy cases.

BANKRUPTCY MILL
A business not authorized to practice law that provides bankruptcy counseling and prepares bankruptcy petitions.

BANKRUPTCY PETITION
A formal request for the protection of the federal bankruptcy laws. (There is an official form for bankruptcy petitions.)

BANKRUPTCY TRUSTEE
A private individual or corporation appointed in all chapter 7, chapter 12, and chapter 13 cases to represent the interests of the bankruptcy estate and the debtor's creditors.

BUSINESS BANKRUPTCY
A bankruptcy case in which the debtor is a business or an individual involved in business and the debts are for business purposes.