You have been pulled into the quagmire of someone else’s bankruptcy.
Your priority is to recover what you can, working within the legal framework of the bankruptcy process. The process is designed to be fair to creditors. Use it fully and carefully to recapture what you can. Along the way you will encounter obstacles. One such is receiving an objection to your claim.
Don’t panic. This is just part of the process of recovering claims. To recoup some portion of the money you are owed you will have to document the work you performed or products delivered and submit your claims in accordance with the bankruptcy process. When you have received an objection to a claim, you must stand in there and fight it off.
It’s like that .270 hitter who invariably leads off a late inning in a tight baseball game. Unless he buys a bus ticket to Cooperstown, this guy’s never going to get into the Hall of Fame. But in a clutch situation, he knows how to work a pitcher. He’ll get to a 3 and 2 count and then begin to foul off pitch after pitch waiting for that fat, fast ball he will rip into the gap for an extra-base hit. It requires athleticism and a little patience. It demands control of the situation.
Stand in there. Do not ignore the objection. Read it carefully. Often the objection is just a documentation issue which can be corrected through amendment. The objection might question the amount, so check the calculations you made in establishing the claim. Again, you can correct this through amendment.
If however, you don’t see any error in your initial claim, then you will need to file opposition to the objection. This is where you will likely benefit from the help of a bankruptcy attorney, one steeped in the intricacies of bankruptcy law, one who knows how to bat off the flurries of objections hurled by the opposing side.
Once your attorney files your challenge against the objection you received, the debtor’s attorney will set a hearing and provide at least 14 days’ notice. The judge will hear from both sides. At this point, the process can go down one of several paths.
1. If factual disputes about the debt remain, the judge will schedule an evidentiary hearing, i.e. a trial.
2. If however, the issues are purely legal, like for example a dispute about the statute of limitations, the judge will either render a decision or ask both lawyers for further briefing on the law.
3. At this point you and the other party will have the opportunity to settle the dispute through mediation instead of a trial. This is a less expensive process and usually recommended if the parties are not very far apart in their claims.
Overall, there are four questions you should ask yourself. How much is your claim? What is the anticipated return to creditors overall? What is the likelihood of getting paid? How strong is your case? While it may be a frustrating experience to forego payment in full, it is important to be pragmatic about how you proceed.
Stand in there and don’t strike out on an unhittable pitch.