A common final choice for many American businesses and individuals today is bankruptcy.
When it’s just not possible to stay afloat on a current course, simply pulling up to the dock and starting over fresh is the best thing that can be done. It allows all parties to walk away with some semblance of closure while providing a smart means of paying off lingering debt. Bankruptcy filings, however, are still easier said than done. There are a lot of minor and major issues that can get in the way of a smooth court case, ranging from complex civil litigation to contract disputes. Whether or not you’ll need an attorney won’t even be a question.
An arbitrator or bankruptcy attorney will go a long way in helping you start over fresh.
What Are Bankruptcy Rates Today?
One of the most well-known issues today is that of bankruptcy. They crop up on a daily basis and are responsible for seeing hundreds, sometimes thousands, of entrepreneurial pursuits go belly-up every year. A recent study found the vast majority of Chapter 11 debtors having less than $10 million in assets or liabilities, as well as less than $10 million in yearly revenue and 50 or fewer employees. Contrary to popular belief, most bankruptcy cases are done by individuals, not businesses.
Why Do People File For Bankruptcy?
A bankruptcy filing can emerge from many different sources. That’s exactly why it’s so widespread. Some of the most common forms of debt in the United States are medical debt, business debt, credit card debt and student loan debt. When these reach a certain number, or start to overlap, complex commercial litigation may be requested to help all parties see eye-to-eye. This is especially important in cases involving employees, studios and managers. Except for the extent modified by parties, class actions are handled by arbitrators or panels in the same way they’re handled under FRCP 23, including notice and settlement.
Who Files For Bankruptcy The Most?
To reiterate the point above, most bankruptcies are filed by individuals, not businesses. This is partially due to companies having more access to effective litigation and being able to better address financial problems as they arise. A lack of knowledge about running a successful business can also get in the way of an entrepreneurial pursuit taking off properly. Back in the 1960′s nearly 12% of federal civil cases went to trial. Compare that to rates today, in which experts have found the percentage of civil cases to reach trial in federal court barely exceeding 1% in an average year.
What Gets In The Way Of A Successful Bankruptcy?
There are multiple factors that can stop you from walking away in one piece. A bankruptcy filing that involves multiple parties and doesn’t have an experienced arbitrator can extend your case for a long time, leaving you in legal limbo for months or even years. Contract disputes are also elements that need a professional eye, as a lot of the legal jargon can go over the heads of even experienced businessowners and freelancers. When in doubt, a simple consultation will help immensely with putting your situation in perspective.
Do I Need A Lawyer For Bankruptcy?
It’s better to be safe than sorry. When you’re considering a Chapter 11 and want to know the best way to go about it, a lawyer can walk you through the process and make sure you don’t miss anything important. Additional issues, such as environmental law and employment discrimination, can be forwarded to specialized professionals who can steer you in the right direction. Take a recent study, for example, in which more than 40% of Americans today are actively worried about indoor air quality, carbon emissions and sulfur oxides, turning to businesses for issues related to environmental arbitration.
Bankruptcy is difficult, but it’s not the end. Let a lawyer help you with contract interpretation so you can move forward with confidence.