How to choose a lawyer in case of bankruptcy?

Law is a vast subject and can cover very diverse areas. Faced with this reality, some lawyers choose to be generalists, others practice a dominant activity, and some choose to be officially recognized as lawyers specializing in a specific area of law. Supervised by the court and various bodies (liquidator, judge-commissioner, etc.), judicial liquidation is a procedure that is sufficient in itself. The presence of a lawyer is therefore not mandatory during a judicial liquidation but may prove helpful in some instances.

For the entrepreneur

When you are a business owner, taking on a bankruptcy lawyer may seem paradoxical given the additional costs of his services. Nevertheless, the lawyer provides advice and assistance, which can prove essential to relieve the manager or defend his interests in litigation. Indeed, during a judicial liquidation procedure, the personal liability of the business manager may be engaged because of a management fault (personal bankruptcy procedure) or in the event of bankruptcy (concealment of assets, fictitious accounts, etc.).

In this case, a lawyer could be subject to one or more sanctions, in particular:

  •           An obligation to pay the company’s debt itself;
  •           A fine and imprisonment;
  •           A permanent prohibition to manage.

In these hypotheses, the lawyer’s mission is to defend the entrepreneur and minimize the penalties that you face. Chapter 7 bankruptcy lawyer gives better advice to face this type of condition. 

For associates

Depending on the nature of the company (limited liability or not), the partners may be forced to assume the consequences of judicial liquidation to a greater or lesser extent. Indeed, if the company in difficulty does not have sufficient liquid assets to reimburse all its creditors, the partners will have to pay. Personally, that is to say, the company’s debt on their investments. Once again, although the lawyer is not compulsory in judicial liquidation, a lawyer may limit the consequences of the procedure on the partners and, in particular, their obligation to meet the company’s liabilities.

For creditors

The company’s creditors in compulsory liquidation may genuinely be interested in a lawyer’s assistance. First of all, at the time of the declaration of claims. Indeed, to hope to be reimbursed, the company’s creditors in compulsory liquidation must imperatively declare their claims to the liquidator. Because of the formalism and the deadlines imposed, it may be helpful to call on a lawyer authorized to carry out the procedures himself on behalf of the creditor. Then, to assert their rights in the event of a dispute of the debt by the manager. When a company is in compulsory liquidation, its primary objective is to limit the number of liabilities to be settled. Therefore, it is common for declared debts to be disputed by the head of the company in difficulty. If a dispute arises, it is then recommended to consult a bankruptcy lawyer.

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