Houston Creditors' Rights Attorneys

Representing Business Creditors in Bankruptcy Courts Throughout Texas

As a business owner, you put your financial neck on the line every time you extend credit to a customer. If a client goes out of business or files bankruptcy, you risk losing every dollar that client owes you. U.S. bankruptcy laws are not so one-sided, however, that the creditor loses all rights.

Hendershot Cowart P.C. is a Texas creditor rights law firm with a long history of aggressively standing up for the rights of business creditors seeking to recover debts. If you are a creditor who faces significant losses due to your debtor's bankruptcy, we can help you pursue all available remedies to protect your interests in a Chapter 7 liquidation or Chapter 11 or Chapter 13 reorganization proceedings in United States Bankruptcy Courts.

On This Page

• Protecting Business Owner's and Creditors' Rights in Bankruptcy Cases
  • The 3 Types of Business Bankruptcy
  • What Are my Rights as a Creditor?
  • What Happens If I Don’t Receive a Notice to Creditors?
• File a Complaint to Determine Dischargeability of a Debt
  • How Quickly Are Debts Discharged in Bankruptcy?
  • How Do I Object to the Discharge of Debt Owed to Me?
• Defending Bankruptcy Preference Actions
• File for or Defend a Fraudulent Transfer
• How Hendershot Cowart P.C. Can Protect Your Rights as a Creditor

To learn how we can help you protect your rights as a creditor, contact us online or call (713) 909-7323. We serve creditors throughout Texas.

Protecting Business Owners and Creditors in Bankruptcy Cases

Our team of creditors' rights attorneys has helped corporate clients of all sizes and structures protect themselves against bankruptcy filings, breaches of contract, fraudulent transfers and financial fraud and misrepresentation by debtors. The sooner you talk to an experienced creditors' rights lawyer, the better your chances for asserting and defending your claim.

We assist creditors with all aspects of creditors' rights proceedings, for both Chapter 11 or Chapter 13 reorganizations and Chapter 7 bankruptcies. Our creditors' rights attorneys can help you:

• File a proof of claim to assert your right to get paid in a bankruptcy case
• Object to the full or partial discharge of debts in a bankruptcy
• File complaints to determine dischargeability of certain debts
• Defend you against preference actions or preferential transfers
• Assert your right to compensation as a critical supplier or vendor
• Recover fraudulent transfers

In most cases, filing a bankruptcy petition creates an automatic stay, which prohibits further collection activities or legal actions against the person or business that filed for bankruptcy. The issue shifts from trying to collect on the debt to determining whether the debt can be preserved through bankruptcy.

We can analyze your case, advise you of your most promising options and pursue the best course of action on your behalf.

The 3 Types of Business Bankruptcy

Bankruptcy proceedings are designed to help struggling businesses and individuals restructure and discharge debts through repayment plans or liquidation of assets. There are generally three types of bankruptcy a business may file:

• Chapter 11 is used primarily for corporations. It allows businesses to keep assets and remain in business while restructuring debt. The debtor’s debts are restructured through a plan or reorganization which often provides for certain pools of money to be distributed to classes of creditors and redistributes the ownership of the business. Some creditors may be able to recover all debts, others recover only a percentage, largely depending on whether creditors have secured or unsecured claims.
• Chapter 13 is for individuals or sole proprietors. It is a reorganization bankruptcy that functions like Chapter 11 but for individuals or sole proprietors who have sufficient income to pay creditors in full or in part. Debts are restructured and a three- to five-year payment plan is created. At the end of the payment plan, remaining debt owed to unsecured creditors can be discharged.
• Chapter 7 is available to both individuals and businesses and involves the liquidation of any available non-exempt assets to be used in payment of debts. A court-appointed trustee is responsible for liquidating assets and distributing proceeds among creditors. If debts outweigh the value of assets, any liquidation proceeds will be split among creditors. However, again, some creditors made be able to recover a greater percentage of their debts, depending on whether the creditor is secured.

Defending Bankruptcy Preference Actions

We regularly defend businesses and individuals who have been subjected to preference actions (preferential transfers) under the Bankruptcy Code. In simple terms, a preference action is a claim by a creditor that a debtor repaid another creditor preferentially, imminently prior to filing a discharge of debt under the U.S. Bankruptcy Code.

The code allows the bankruptcy trustee to recover money from creditors who were repaid during a certain period before the bankruptcy filing in certain cases. Officers, directors, and company insiders generally have a one-year look-back period, while others have a six-month look-back.

You or your business may have several defenses to a preference action. For example, if the payment you received was for "new value received," you may be able to successfully defend yourself against a preference action.

We understand the Bankruptcy Code and how it may affect creditors. We understand what may be at stake in your case, and we will protect you aggressively.

File For or Defend a Fraudulent Transfer Claim

Sometimes, a bankruptcy trustee ties a preference action to an allegation of a fraudulent transfer. It is unlawful for a bankruptcy debtor to transfer an asset with the sole purpose of avoiding the effects of bankruptcy against the asset. This is called a fraudulent transfer.

The Bankruptcy Code lists numerous situations in which a transfer may be fraudulent, including:

• Transfers made by a debtor with the intent to delay or defraud creditors
• Transfers made for less than full value
• Transfers to a general partner when the partnership was insolvent
• Transfers to a trust in which the debtor is a beneficiary

In cases involving fraudulent transfers, other creditors listed for dischargeable debts have the right to file preference actions to recover the payments. If successfully recovered, the debt will be open for objection to discharge by creditors. Our bankruptcy fraud defense attorneys can fight to recover fraudulent transfers to preserve your options as a creditor.

How Hendershot Cowart P.C. Can Protect Your Rights as a Creditor

Receiving notice that a client has filed for bankruptcy starts the clock for creditors who’ll need to navigate what are often unfamiliar proceedings. Hendershot Cowart P.C. is a creditors rights law firm that provides personalized support to business owners, general counsel, corporate directors, and executives who must address a customer’s bankruptcy and the related financial and regulatory fallout.

We have more than 100 years of combined experience successfully resolving transactional, litigation, and bankruptcy matters for businesses in Texas and throughout the U.S. Many of our bankruptcy cases are referred to us by other firms because we have the resources and experience to get results.

We represent business creditors in bankruptcy courts throughout Houston and Texas. Schedule an initial consultationwith our law firm to learn how we can help you. Call (713) 909-7323today!