Please,...in dire need of help! (long, sorry)

[Stevessvt]

I am a partner in a small business with my brother. Last September I divorced my wife of 16 years. In doing so I also lost my health insurance. I am diabetic, and my supplies cost about $400/mo. So in addition to losing an income and paying child support, it now costs a bundle to keep myself alive. During our marriage we ran up a huge credit card debt, which before divorce I was keeping up with. But now in order to make my yearly bills (taxs, home owners insurance) something had to give. So I filed chapter 7 in October. I am current on my car and house payments. I gave my lawyer all the information I had to the best of my knowledge. He told my there was a statute regaurding partnerships protecting them in cases like this, but there was a very slim chance it wouldnt go our way. Well, it didnt. Evedently, since we never registered with the state as a partnership, it doesnt apply to me. I had no idea about having to do that. We have been doing our taxs as a partnership for many years. I thought thats all that was required. Now the trustee wants to take over my half of my business and re-sell it back to me, and disperse he money to the crediters.

My partner is very upset about this. So I told my lawyer I wanted to withdraw the petition for bankruptcy. Against his wishes, he agreed. So, knowing what I know now, that we are not a partnership registered with the state, we incorporated over the holidays. Then my lawyer says that I need to spend $1000 to have my business worth evaluated. I told him I incorperated, and he flipped out. I explain my reasoning, but evedently, I screwed up pretty good. I just want this to go away. I will make restitution some how some way, but had I known that my business could be taken from me, I would have never started this! Now my lawyer is saying he is withdrawing from my case because I incorporated. I dont know what to do. I need help. Please help me. I dont have any more money to get another lawyer. And from what mine says, the trustee has no intention of letting me out of this.
Im begging. Please.

[StartingOver08]

I have read your post twice. You are in a difficult position.

The business aspect is quite complicated. Essentially the Trustee wanted you to buy out your half of the business because it was your asset. Therefore you withdrew your CH 7 petition.

Now you have converted your asset to a corporation. Corporations are separate entities, so it appears that you transferred (converted ) an asset of yours to a separate entity. Even if you were not aware of the consequences, the Trustee will not view it that way as they represent the creditors (and themselves) in the BK.

Your attorney wants nothing to do with this situation so he won't answer questions.

First, we are glad you came to ask questions. We are not here to pass judgment, only to help the best we can. I am not an attorney, so I can not give any sort of legal answer - and it may not even be the right answer, but we try to help with everyone's points of view to your unusual situation.
So, hopefully you can clarify a few things:

1) What is the current status of your BK case? Dismissed??
2) What did the trustee want for your half of the business?
3) Can you post your location (state)? and your debt details? and income?
4) What type of corp did you form? C, LLC etc
5) Is your business an inventory type business?

Hopefully with a little more detail we can all help you formulate some sort of plan to work out of your situation.

[dingdong]

Couldn't you just dissolve the corp?

And then register as a sole pro?

I am just throwing stuff out there, not an expert at all in corporations.

[AngelinaCat]

I am a partner in a small business with my brother. Last September I divorced my wife of 16 years. In doing so I also lost my health insurance. I am diabetic, and my supplies cost about $400/mo. So in addition to losing an income and paying child support, it now costs a bundle to keep myself alive. During our marriage we ran up a huge credit card debt, which before divorce I was keeping up with. But now in order to make my yearly bills (taxs, home owners insurance) something had to give. So I filed chapter 7 in October. I am current on my car and house payments. I gave my lawyer all the information I had to the best of my knowledge. He told my there was a statute regaurding partnerships protecting them in cases like this, but there was a very slim chance it wouldnt go our way. Well, it didnt. Evedently, since we never registered with the state as a partnership, it doesnt apply to me. I had no idea about having to do that. We have been doing our taxs as a partnership for many years. I thought thats all that was required. Now the trustee wants to take over my half of my business and re-sell it back to me, and disperse he money to the crediters.

My partner is very upset about this. So I told my lawyer I wanted to withdraw the petition for bankruptcy. Against his wishes, he agreed. So, knowing what I know now, that we are not a partnership registered with the state, we incorporated over the holidays. Then my lawyer says that I need to spend $1000 to have my business worth evaluated. I told him I incorperated, and he flipped out. I explain my reasoning, but evedently, I screwed up pretty good. I just want this to go away. I will make restitution some how some way, but had I known that my business could be taken from me, I would have never started this! Now my lawyer is saying he is withdrawing from my case because I incorporated. I dont know what to do. I need help. Please help me. I dont have any more money to get another lawyer. And from what mine says, the trustee has no intention of letting me out of this.
Im begging. Please.

Hi Stevessvt: Welcome to the forum.

I truly congratulate ‘StartingOver08’ for being able to read and decipher and respond to your post.

I—and many of us--do not have the eye power or the patience, to be able to read through such a run-on post. If you wish us to try to help you, you must help us. Please follow these simple guidelines:

Please separate every new thought into a new paragraph. Each ‘new thought’ should be separated into a new paragraph.

We understand your need to tell the entire story, but please keep it to the minimum details necessary to understand your situation.

If you would like to correct your post, you can go into the ‘edit’ mode on your profile, and edit as necessary.

Thank you,

[AngelinaCatHub]

[Stevessvt]

I have read your post twice. You are in a difficult position.

The business aspect is quite complicated. Essentially the Trustee wanted you to buy out your half of the business because it was your asset. Therefore you withdrew your CH 7 petition.

Now you have converted your asset to a corporation. Corporations are separate entities, so it appears that you transferred (converted ) an asset of yours to a separate entity. Even if you were not aware of the consequences, the Trustee will not view it that way as they represent the creditors (and themselves) in the BK.

Your attorney wants nothing to do with this situation so he won't answer questions.

First, we are glad you came to ask questions. We are not here to pass judgment, only to help the best we can. I am not an attorney, so I can not give any sort of legal answer - and it may not even be the right answer, but we try to help with everyone's points of view to your unusual situation.
So, hopefully you can clarify a few things:

1) What is the current status of your BK case? Dismissed??No, still in the thick of things
2) What did the trustee want for your half of the business?
He wants me to have it evaluated for its worth for $1000 that I really dont have
3) Can you post your location (state)? and your debt details? and income?
Fl, about $65,000, I make about $27,000
4) What type of corp did you form? C, LLC etc
LLC
5) Is your business an inventory type business?
Yes

Hopefully with a little more detail we can all help you formulate some sort of plan to work out of your situation.

Hopefully This helps. I originally didnt want an ousider sticking his nose in my business, so I refused to have it evaluated. Today my lawyer said he would stay on to finish my case if I let it be evaluated. I talked to my partner and we agreed to have it done to get this behind me. I call my lawyer and tell him this, and he informs me nevermind. He is going to withdraw from my case anyways.
Sorry for the run on paragraphs.

[Stevessvt]

Thank you, ma'am. I am really at a loss here now that I have no lawyer. At this point I just want to back out and deal with the crediters on my own, without having my partner getting dragged in to it.
And I no longer hae a wife, which is somewhat why I am here.

But I do have a fiance now

[Stevessvt]

Im still trying to figure out how to edit. Usually its at the bottom of my post....

[catleg]

Is this the district in FL with the pain in the ass trustee?

What happens if you refuse to give a value? Dismissed?

Is it possible that the business has no significant value other than providing employment to you and your brother?

Surely you have some idea of the value of the business, either the net assets or the annual revenue minus expenses? (operating profit)

Might be safest for your brother to get an appraisal and buy you out.
Then you just work as his employee, ignore the credit cards and live your life, eventually after some time passes file BK again.

[danaf]

Glad you have a fiance. Hope she sticks around with all the baggage and no money. In any case, you made a huge blunder. Damage is done. Not much you can do about it now except live with it and maybe get either a new job that pays more or a second job. You might be able to refile in a few years but I have no doubt what has occurred is now on the radar and will stay there. And of course you can always consult other lawyers.

[AngelinaCat]

Im still trying to figure out how to edit. Usually its at the bottom of my post....

Hi Steve:

Thank you for trying. Look down at the bottom of your posting box. You should see at the bottom right hand side where the normal 'button' is "quote". In your profile, you should see the "quote" button and to the very left of that is a button that says "edit". That is only available to you as you are the author of that post. You should be able access that and fix your post.

Thanks for your attempt.

[StartingOver08]

I am in FL too - in fact some of the others that answered are also in FL.

Do you know which district you are in?
Hopefully it is not the middle district of fl

What type of business do you have?

There must be a way to make this work for you....we just may not have the answers tonight.

[FloridaGuy]

I read the post... then came back later to check it out again. Yep... Look for another lawyer right away. Get multiple opinions if you can, before you retain another one. Does your case have any pending motions, or responses due? If so how soon? This is something you want to find out about right away.

Find out about the items I mentioned above, THEN... Since your attorney dropped you, if you don't get another one immediately, you may be able to contact the clerk of the court, AND/OR trustee directly. (I suggest this as a LAST RESORT) and update them as to your being without lawyer situation and tell them you are working on retaining another one, and want to stay up to date on your case.

I may be WAY off base, and others may have suggestions as well.

Glad your here for assistance now... but too bad you didn't check here before your case started.

[Stevessvt]

I have to go Monday for a depo, but now that I have no lawyer, how can I hold that off? Also, I had $3000 at the start of this. All the money I have. I was ordered yesterday to give it to the trustee. So I literally have -0- money to get another lawyer with. As it is, I was going to use that money for my property taxs.
I own a pawn shop in Palm Beach county.
I still dont have an edit button yet. Maybe since Im a newb there is a time restriction?

[StartingOver08]

Yes stevessvt, there is a time out on the edit button! The edit button is on the lower right corner of the post right next to the quotes button, but is only there for a short time.

You are in a good district of FL (Southern District) for filing BK.