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Bankruptcy Trustee and the Meeting of Creditors

The person appointed to administer a bankruptcy case and the short, sworn examination every debtor must attend - what the trustee is looking for, who actually turns up, and what happens after.

Informational only - this is not legal advice. These definitions explain general legal vocabulary in plain English. They are not advice about your situation, reading them creates no attorney-client relationship, and the law differs from state to state and changes over time. For advice you can rely on, speak to a lawyer licensed in your state.

What it means

Every consumer bankruptcy case has a trustee. In Chapter 7 the trustee is a private lawyer or accountant drawn from a panel maintained by the United States Trustee, a Justice Department office that supervises the system; the trustee's job is to collect any non-exempt property, sell it and distribute the proceeds to creditors, and to look for assets the debtor did not disclose. In Chapter 13 a standing trustee receives the debtor's plan payments each month and distributes them, reviews the plan for feasibility and good faith, and objects to a plan that pays creditors less than the law requires. The trustee is not the debtor's lawyer and not the judge; the trustee represents the interests of the creditors as a body.

Shortly after the case is filed, the debtor must attend the meeting of creditors, named for the section of the Bankruptcy Code that requires it. The trustee presides; the judge is not present and may not attend. Under oath, the debtor confirms identity with photo identification and a Social Security card, confirms that the petition and schedules were read and signed and are accurate, and answers the trustee's questions: about income and expenses, property and its value, recent transfers, lawsuits, tax refunds, anything owed to the debtor. Creditors may attend and ask questions, but in a typical consumer case none do. Most meetings are brief; many are now held by video or telephone.

The meeting is where undisclosed property, recent transfers to relatives and questionable valuations surface, and the trustee's follow-up - a request for bank statements or tax returns, an appraisal, a demand to turn over an asset or a tax refund - comes from it. Deadlines for creditors and the trustee to object to the discharge or to the dischargeability of a particular debt run from the date first set for the meeting, which makes that date a fixed point in the calendar of the whole case.

Where this comes from

The meeting of creditors is required by 11 U.S.C. § 341, with the debtor's duty to attend and answer at § 343 and the judge barred from attending by § 341(c). The trustee's duties are at § 704 (Chapter 7) and § 1302 (Chapter 13), and the United States Trustee programme at 28 U.S.C. §§ 581-589b. The debtor's duties to cooperate and to surrender property and records are at 11 U.S.C. § 521. Federal Rule of Bankruptcy Procedure 2003 fixes when the meeting is held, and Rules 4004 and 4007 tie the objection deadlines to it. The periods in those rules are not stated here.

When people hire a lawyer for this

The meeting goes badly for people who treat it as a formality and well for people who prepared: a lawyer will have reviewed the schedules line by line against the bank statements the trustee will read, will have told the debtor what the trustee in that district habitually asks, and will sit beside the debtor to answer procedural questions. The mistakes that turn a routine case into a contested one - a forgotten account, a car signed over to a sibling, an inheritance expected soon - are all avoidable if raised before filing rather than discovered under oath.

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Part of the LawyerLand plain-English legal glossary. Definitions are written from primary sources - statutes and court rules - and each entry states the authority it rests on, or says plainly when the doctrine is state law with no national rule.

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