Business Bankruptcy

Due to ever-increasing global competition, a new and different economy, terrorist threats, more conservative bank loan criteria and a number of other factors, more and more businesses, especially small businesses, have been struggling financially.  Even when larger businesses located outside of South Carolina begin having financial difficulties, small businesses within the state of South Carolina are financially impacted because of their dependence on the larger businesses.  Additionally, businesses may face other obstacles such as increased competition, cash flow problems based on underbidding jobs, adverse weather, an unstable economy or any many other hurdles, including failure to collect receivables because those who owe are also undergoing financial difficulties.  The Federal Bankruptcy Law provides financial relief in these situations.

Although a sole proprietor can file a Chapter 7, Chapter 13, or a Chapter 11 bankruptcy, the owner is actually filing a personal bankruptcy, because a sole proprietorship is in fact the sole proprietor (i.e. the individual), and not a separate entity (or person).  A corporation, partnership or Limited Liability Company (LLC), however, is in fact a totally separate entity (or person).  Those forms of businesses are separate and distinct from their owner(s).  Such a business must protect its own assets and resolve its liabilities.  All businesses, with the exception of a sole proprietorship, therefore have the option of filing either a Chapter 7 (i.e. closing the business and surrendering assets to creditors) or Chapter 11 bankruptcy (i.e. continuing the business and retaining all assets necessary for operation).  A Chapter 13 Bankruptcy is a smaller reorganization in which consumers and/or sole proprietors retain all necessary assets and reorganize or restructure all debts.

The most remarkable function of any bankruptcy is that upon its filing with the federal court, an “automatic stay” (i.e. federal injunction) is immediately invoked, prohibiting collection actions, lawsuits, telephone calls, harassing letters, etc. from creditors.  Creditors are not allowed to contact the bankrupt debtor or entity and each creditor is warned of this in writing by the Federal Bankruptcy Court.  Creditors are instead instructed to communicate with the debtor’s attorney regarding all matters.  That attorney spends an enormous amount of time answering questions of creditors and their lawyers and educating them regarding policies and procedures under the Federal Bankruptcy Laws.

Few attorneys handle bankruptcy cases, and of those few who do, even fewer are capable of handling business cases.  Therefore, it is imperative that a business owner seek the advice of an experienced business bankruptcy attorney.  DO NOT BE FOOLED BY ATTORNEYS WHO PLACE LARGE ADVERTISEMENTS IN THE PHONE BOOK OR WHO ALLEGE THEY HANDLE BUSINESS BANKRUPTCY CASES.  Just as you would ask other physicians for the name of an extremely experienced physician to handle a serious medical matter, feel free to ask other bankruptcy attorneys to suggest a very experienced business bankruptcy attorney.

Robert H. Cooper of The Cooper Law Firm is one of the most experienced business and consumer bankruptcy attorneys in the state of South Carolina.  He has handled thousands of cases and is well known among debtor and creditor attorneys, trustees, judges as an experienced and successful bankruptcy attorney.  He has fought hard to represent debtors and has set new law in the bankruptcy field in the state of South Carolina.