Trustee Turnover Powers in Chester Bankruptcies
I've discussed frequently that the Trustee has substantial power and authority. The Trustee has a duty to administer assets in a Chapter 7 estate. Sometimes, the Trustee will use their "long-arm" powers, which are turnover powers and avoidance powers. This means that sometimes the Trustee can reach out to property of the estate to satisfy creditors. Frequently, a Chester County bankruptcy lawyer will battle with a Trustee if there is a contentious issue. Most often, however, the cases are fine and there is no adversarial proceedings.
Turnover powers are provided to the trustee pursuant to 11 U.S.C. 542. If a person lists an asset and it is held by a third party and the Trustee seeks to liquidate the asset, they can force the third party to turnover the property (regardless of whether the person wants it). Most of the time, this is rare. If it does happen, the third party is normally scared and gives over the property in a timely matter. If, however, the person ignores the Trustee, they can file a motion in the form of an adversary proceeding.