What Is A Trustee?

There is a trustee assigned in every case filed in the U.S. Bankruptcy Court system. A Chapter 7 trustee is a fiduciary of the creditor. Their job is to analyze the bankruptcy petition filed with the Court and look for assets or monies that are non-exempt. It is the trustee’s job to seize these non-exempt monies and assets so that they can apply these monies and assets as payment to the creditors.

In the vast majority of cases, trustees issue what are called No Asset Reports. This report means that they have no intention of seizing any monies or assets from the bankruptcy estate. In such cases, the debtor’s process simply moves along to discharge.

While there is a technically adversarial relationship between the debtor and the trustee, in practice it is more of a partnership to ensure the smooth flow of the bankruptcy process and fairness to all parties in interest. Trustees in Colorado generally do not appear adversarial. The reality is that most trustees are actually debtor’s part time counsel. As such, they understand the complicating factors that can lead to a bankruptcy. They themselves, in many instances, either have been or are debtor’s counsel. They know and understand what it has taken for the debtor to get to this point.

In addition, Morse Law, having filed thousands of bankruptcies, has developed many professional relationships and in many instances friendships amongst our attorneys and the Chapter 7 trustees. As such, the adversarial nature of the relationship tends to lose its tenor. Debtor’s counsel and Chapter 7 trustees tend to work more as a cohesive unit, all looking forward to moving the bankruptcy successfully through the process.

Prerequisites

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