Bankruptcy Trustee Surety Bonds

Access to major surety markets allows us to offer the lowest premium rates in the country. We are confident that our premiums can help to reduce administrative costs for estates under your control. In most instances, we are able to beat the competition’s premium.

For over four decades, our team has issued thousands of bonds on behalf of trustees in every jurisdiction of the United States bankruptcy court system. International Sureties, Ltd. has brokered bonds for some of the largest and most complex bankruptcy cases in U.S. history. Our years of experience and hard work have earned the respect and confidence of countless trustees and fiduciaries, and some of the greatest practitioners in the insolvency and restructuring arena.

Typically individuals, but in some cases, businesses file Chapter 7 bankruptcy.  The purpose of chapter 7 is primarily to liquidate assets into cash to pay off their debt to creditors.

This bankruptcy filing is available to family farms and fisheries that are unable to pay their debt.  This provides protection from creditors taking action against their livelihood while they are in the process of satisfying their obligations.

The legislative purpose of the SBRA was to provide a fast track for small businesses to confirm a consensual plan with the assistance of a private subchapter V trustee.  Before beginning official duties, a person selected to serve as a trustee must file with the Court a bond within six days after selection. The initial amount and sufficiency of the bond is determined by the UST. 11 U.S.C. § 322.  In general, among the most important subchapter V trustee duties are assessing the financial viability of the small business debtor, facilitating a consensual plan of reorganization, and helping ensure that the debtor files or submits complete and accurate financial reports.

A Receiver is an officer appointed by the Court who is given custody of specified assets with direction to liquidate them and distribute the proceeds. A Court order is typically required to appoint a Receiver, and the terms of the order describe the Receiver’s duties and powers.  Receiverships can be broadly divided into two types:

• Those related to insolvency or enforcement of a security interest.
• A person is incapable of managing their affairs and so the court appoints a receiver to manage the property on their behalf—for example a receiver appointed by a Court of Protection under mental health legislation (in some jurisdictions, called conservatorship).

In some Chapter 11 bankruptcy cases an Examiner is appointed by the court for the benefit of creditors and equity security holders.  An Examiner generally does not take control of the operations of the entity, but acts as an investigator of the pre-petition events of the debtor. Typically an Examiner is not appointed unless there is an issue with fraud or mismanagement. The Examiner will review the conduct of the business in order to assist in determining if reorganization is viable. The duties of an Examiner are dictated by the court with a wide range of possibilities. The court adapts the duties of the Examiner to accommodate each individual case and will issue an order outlining the specifics. The Examiner will then carry out these duties and report back to the court.

After confirmation and appointment, the liquidation trustee then serves as the liquidation trust’s representative and is responsible for complying with the trust agreement (and confirmation order), liquidating the assets and making distributions to trust beneficiaries.

When a Plan agent is appointed, they are responsible for the obligations outlined by the confirmed plan.