Trustee Blog

Negotiating with The Bankruptcy Trustee

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Chapter 7 Bankruptcy Trustee Helen Frazer

As mentioned in a recent post, Chapter 7 Trustee Helen Frazer is a California Certified Specialist in Bankruptcy. She is also a Trustee’s attorney and handles litigation for other Trustees. I recently saw her at the Bankruptcy Court in Judge Jury’s Courtroom. I was walking by Judge Jury’s calendar and saw that a trial was about to begin.

In bankruptcy we rarely have trials, so I was interested to see what was going on. The Plaintiff was Trustee Pringle and his attorney was Helen Frazer. The Trustee wanted the debtor to turn over an asset and the case needed litigation to enlighten the debtor.

This scenario reminded me that the Trustees have the power and authority to litigate their positions. However litigation is the least favored tactic since it is both time intensive and costly. In the Riverside Division of the Central District of California Bankruptcy Court, we have relatively little Trustee litigation. I think this is because the Debtor Bar in the Riverside Division is knowledgable and works with the Trustees to work out issues before litigation.

Legal positions can be taken, but the Riverside Trustees are amenable to discussing the issues and possibly working out alternatives.

Practice Pointer;

If you find yourself and your client in a confrontation with a Bankruptcy Trustee, here is a plan of action. As with all potential litigation, it is important to clearly state your client’s position. I suggest putting your client’s position in a letter to the Trustee and then following up with a telephone call. Keep an open mind with the Trustee or Trustee’s attorney when discussing alternatives. It may be in your client’s best interest to not litigate a matter but to settle the matter, so keep that in mind when you have these issues.

Had the Debtor negotiated with the Trustee’s attorney Helen Frazer, he would have saved himself thousands of dollars in attorneys fees in the above case. Helen Frazer won the case and now the debtor has to turn over the property and pay her firm for the privilege of doing so.




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