Expert: Mark J. Markus- California Bankruptcy Attorney - 8/31/2009

Question
We were listed as creditors in a former business partner's bankruptcy.  He surrendered his home in the bankruptcy plan, which was approved several months ago.  Since that time, he has been removing items from both inside and outside the property, including a pool and a shed.  He claimed he was entitled because the foreclosure was not finalized. Is that true? If he sold these items, would he have an obligation to report any income to the trustee?

Answer
Well, technically he's not supposed to sell anything without court approval, but in all likelihood the assets were exempt or otherwise already calculated into the plan payments, or else the plan wouldn't be approved.  You don't indicate what Chapter was filed or whether a plan has been confirmed yet.  The outcome may be different depending on which chapter was filed.

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