Do you guys remember that Reddit screenshot that was like:

Incel-adjacent guy: the simple fact is that no hot woman wants to get with an average looking nerdy man. That's why guys like me are fucked.

Normal commenter: why don't you try dating average looking women with nerd hobbies then?

Incel guy; what would be the point of that

.......... Sometimes the male loneliness discourse feels a lot like that.

I don’t think Hermione is perfect, but I can see where people are coming from with that. Closely related to that, admittedly she is JKR’s self-insert, which is relevant, but I don’t think in a way I see it often levied against her. That word and especially its manifestation Mary Sue gets thrown around a lot these days, but there’s nothing inherently wrong with self-inserts. If one has humility, introspectiveness, and honesty to truly examine and portray themselves truthfully, with all their follies and flaws displayed openly at the world. Realistic self-inserts after all are full-fledged and multidimensional characters, and it has been done well often by many authors throughout ages (like Agatha Christie or Kurt Vonnegut to name a few). Presenting highly idealized and (unrealistically) flattering portray of oneself, and then living out one’s fantasies vicariously through that fictitious avatar is entirely different matter. Regardless of exact nature of those fantasies (be them power fantasies, or erotic, or romantic, or just world, etc. Whatever ends up in those “then everyone clapped”-moments). It would be a stretch and unfair to describe JKR and Hermione like that. My theory for Hermione is that she started out more closely as a somewhat authentic if not exaggerated portrayal of her younger self at earlier books. Slowly as the series progresses JKR became ever more attached and fond of Hermione as a character independent of herself and her own life history. Earlier books Hermione’s flaws are lot more pronounced, and they also feel a lot more raw and personal. They get ironed out, refined and almost sublimated, to a point that while they are never entirely absent, they are so muted at the end that might not even be there. In the earlier books she frequently comes off as awkward, overconfident, precocious, tactless, stubborn, self-righteous, and she often totally lacks subtlety and doesn’t seem be at all aware of her actions are perceived by others. She also lacks humility, when her own moral intuition and sense of justice is concerned.   To a degree, she gave her something of an idealized past and certain experiences she probably wished she would’ve had (like the princess moment at the Yule Ball. I don’t know if she fantasied of being belle of the ball exactly like that, but in general an experience of being desired and beautiful). Despite those certain indulgences, there’s brutal honesty there as well (her classroom behavior, S.P.E.W., etc.) Yet, as books went on, It never reads like a narcissistic projection of the self, but more like an attachment between parent and child, protégé and mentor, biographer and biographee, teacher and favorite pupil, or author and her favorite character. It’s not unrealistic ofc, that when people grow older, they mature and their personality flaws are at least tempered, or they entirely grow out of them. However, usually something else comes along molded by new experiences and circumstances, thus even if people don’t have problems they had as young, something or other comes along to fill that void.   Hermione is not entirely without fault even in later books, but often even when she’s wrong her thoughts are well-founded and usually even partially right (like with Draco as a Death Eater. She was technically wrong, but it’s not like Draco was a Death Eater in a way Bellatrix or even his father was, which totally was the way Harry thought he was). When she acts childishly or selfishly she usually is justified at least somewhat. Ultimately her errors are quite inconsequential compared to Harry and Ron. I believe, it was partly because JKR had become so much more fond of her, that she simply didn’t have heart to give her defects, hardships and failures as much as she had in the beginning. It was a gradual shift without a clear turning-point, but it never goes to the total extreme that she’s absolutely flawless and perfect, nonetheless the process is there. Closest to a turning point is perhaps the Yule Ball, though despite everything, I always found it to be kind of sweet and fluffy in itself rather than self-indulgent. What was more came afterwards, when she kind of dismissed it, because you see it’s not like she’s vain about her looks. I mean, she totally could be pretty, if she just wished so, and paid enough attention to her appearance. But no no, she’s not superficial like all those other simpering girls. Yet, she totally could be because she’s naturally pretty beneath it all. I would totally win, only if I bothered to even play is kind of an ultimate flex.    Another major element for this is the genre of Harry Potter series is. It is a coming-of-age story, and a school drama as well, but above all else, the overarching narrative is a fantasy adventure. The main-plot is the struggle against and an ultimate defeat of evil antagonist. The main plot becomes ever more relevant as the series goes on, to the final conclusion of the Deathly Hallows, which is devoted almost entirely to it. This affects characterizations, not only that the trio are heroic protagonist, who overcome obstacles and perform extraordinary feats and heroic deeds against all odds. It’s given that even if they do mistakes, and don’t always win, they’ll triumph and succeed in a way, that wouldn’t be appropriate if it was just a drama, or a realistic depiction of teenagers. This is especially true for both Harry and Hermione at the later books (little less for Ron, but he’s there). They are going to be way more competent, capable, virtuous and lucky than teenagers or children that age would be realistically, or most other literary genres. Second effect is sort of economics of a story. At the later books, so much has to be allocated to the main plot, with all its many intricacies. Events have to be told, and one has to build up everything up from the Macguffins to Voldemort himself, and then resolve all it. Less and less time and attention can be devoted into Hermione’s backstory (or anybody’s), or interpersonal drama or individualized character development. In my opinion earlier books stroke a much better balance than the later ones between these different elements. Or perhaps I just never found the main-plot or the Second Wizarding War (my God, it could even abbreviated as WW2) to be all that interesting or compelling. Also, as HP become more about this epic fantasy adventure, and less about growing up, being in a school and the interpersonal drama, fitting in, finding and forming friendships, and so on. As this happened, I am quite sure that Hermione become more divorced from JKR’s own experiences and her self-insert as Hermione. Even if it is a magical school, it is still a school, with all the anxiousness about friends, future, crushes and dating, school work, teachers, etc. It’s easier to project yourself in that common setting such as a school is, rather than riding dragons and breaking into banks and hunting down and destroying evil magical artifacts. I can understand, why writing Hermione become more difficult, as environment and rhythm of books changed considerably from more familiar to more fantastic, and I can see how especially Hermione didn’t make the transition as well, because she was more heavily grounded into former. I can see why in its entirety Hermione comes of as a little contradictory, because there’s truth to both claims that she’s at the same time too perfect and that she’s multifaceted and complex. There’s interesting core to her character, and there’s a lot of material and potential to work with. Unfortunately, due many aforementioned reasons JKR didn’t manage to realize that potential and set-up she had constructed. I don’t think it was an utter failure, even at the latter books, but missed opportunities and unrealized potential were many. I didn’t meant to write JKR or canon apologia here, but I don’t detest either of them. There’s clearly something there, both to Hermione and canon, but it’s kind of uneven and conflicting at the times. A mixed bag, but usually that’s most interesting starting point for a fanfiction, unlike a perfection or fiasco. Trying to turn shit into gold is not worth of the effort, but neither is trying to fiddle around a divine masterpiece. I’ve always felt that fanfiction actually benefits, if author has left a lot of ground uncovered and has some internal contradictions, which gives way for different possibilities and avenues for fanfiction writers to broaden horizons and deepen characterizations, and fulfill those missed potentialities. If HP was this crown jewel of perfection by all means, solely without any missed potentialities or loose ends, then I probably wouldn’t even be interested in reading fanfiction about it. As it would’ve been done so wonderfully in canon, that fanfiction could never match up in comparison, and there wouldn’t be room for other attempts (couldn’t imagine reading Dostoevsky fanfiction as an example). I’ve always held, that one main reason why Draco as an example is so prominent and popular in fanfiction, is because he fit so comfortably in that perfect sweetspot of canon coverage. He’s not Theodore Nott, which has almost no hooks or knowable features, but neither is he Harry, who’s so well and extensively covered, that I’d find it suffocating to write in his perspective. P.S. If there’s one thing JKR didn’t spoil her was romance lol. No hot steaming affairs or a passionate romances for her. Not even giving her that cultured and sophisticated (if a bit dangerous) chad vying for her attention, who is inexplicably attracted to her, and ends up worshiping her. Actually, it’s not like she even got a sugary and mushy teenage dating treatment either. Awkward courting, necking at the make-out point, him carrying her books and suddenly developing uncharacteristic interest at the schoolwork and library. What was there, jealously and couple grand gestures at the end. Poor girl. I’ve always wondered whether JKR meant to write Romione as she did with Hinny. A little schmaltzy, “then the best friends, the heroine and heroine fell in love, and got married and lived happily ever after”-affair (kind of fitting for a fantasy adventure novels primary aimed for children and YAs. Hinny was ok I suppose as compatibility goes, but Romione in the other hand… well the basic idea if not characters chosen were acceptable). Or was it suppose to be a gritty realism, more in line with her self-insert, in which the smart girl gets roped in by almost the first guy she’s ever into, who’s actually really unfit for her.

How to Start a Real Estate Business?

Introduction to the Real Estate Sector: Among the booming sunrise businesses in the world is undoubtedly Real Estate. Today, it's been recognized as one of the most lucrative investment choices. 

A fantastic number of individuals despite the demographic aspects are seen considering property as a critical investment mainly because this is one sector the value of which is guaranteed to take up in the long term. Furthermore, this business has ended up making a win win situation for all of the stakeholders who have been hold direct or indirect interest in the same. 

This is one of the very important reasons which has contributed to the increase of property business generally, which is precisely why we see a range of real estate businesses and agencies setting base in every nook and corner of this road. There might be plenty of people around who are looking forward to establish their own successful real estate businesses. 

However, they are frequently confused as to where they ought to start from. So as to bring an end to the problem faced with such people out there, we'll be assisting you with a concise blueprint that we believe might wind up playing a critical part in your real estate journey. 

The Starting Point - Boost Your Start Up Capital: 1 main requirement for kick-starting a business is to start by raising the essential start up funds, the core function of which is to fulfill the different fixed and variable expenses. This concept holds equally true in the event of a property business. 

So as to give birth to your fantasy, you will need to start by finding and eventually investing in the office area, purchasing the essential office equipment, designing logos and preparing additional marketing material and of-course diverting funds towards insurance. 

Similarly, you'll also require funds to meet the regular operating expenses in the days to come. After the funds are in place, the first step is readily met. Meet Regulatory Requirements: It's vital for you to remember that you can't truly begin transacting in the real estate arena on any day randomly. In the majority of the states, you want to maintain a valid license so as to have the ability to function as a consultant. 

It's a good idea that you get on board a trusted legal counsel in order to better acquaint yourself with the rules and regulations which are widespread in the real estate platform of the nation. As soon as you have the required permit in hand, you may start your operations as a property consultant. 

Get into Your Hiring Boots: Next up you'll be asked to initiate the recruitment and selection processes so as to employ agents to your group. At this time, it's vital that you draft an independent contractor arrangement in order to maintain clarity and clear communication between you as the employer as well as your unique agents. 

The agreement must necessarily house details concerning the ratio in which the commission will be dispersed, code of ethics that will need to be imbibed from the brokers and of-course the general office associated policies and processes. 

Repair in Your Head - Customer is your Whole & Sole: As soon as you're through with the above 3 steps, you want to proceed further so as to construct a loyal client base. To be able to survive and succeed as a real estate entrepreneur, a stable clientele becomes crucial. You may reap results in this region by investing towards direct and indirect advertising, integrated marketing communication models and of-course a bit bit of public relations. Similarly, you may even put weightage on joining hands with a Search Engine Optimization firm, which is thought to play a vital role in boosting your visibility and presence on the market

The Greatest Add-on - A professional looking site: The above mentioned elements are essentially the preliminary droplets that would wind up contributing to your broad ocean of property business. Aside from the aforementioned aspects, there's still another element, which if added to your business initiation program is guaranteed to benefit you in a gigantic way. 

The building block about which we're speaking here is the requirement to develop and present a relevant, innovative and of-course different looking professional site for your business unit. If we were to require the statistics, then we can easily arrive at the conclusion that at the recent times it's been discovered that over eighty percent of those individuals begin their home search online. 

This is precisely why a professional site is very likely to come handy to your property unit. Similarly, a website may also help you endure the cut-throat competition by making your details available to the potential clients at large. 

So You Want to Start Your Own Real Estate Business, Huh?

First, permit me to say congratulations on choosing to be your own boss. It is among the toughest and funniest, nevertheless rewarding decisions a person can make. You're about to venture on an incredible, lifelong journey full of limitless possibilities. 

However, be certain that you are properly prepared, or the outcome might be devastating. The principal purpose of this report is to serve as a comprehensive checklist for planning, creating and structuring your own property business. I'll also explain the benefits of detailed planning and direction, as well as the pitfalls for failure to do so. 

First things first: what is the title of your new business? Which kind of business entity will you form? A sole proprietorship is the fastest and simplest; however, it may lack the essential asset and liability protection justified by your business model. My personal favorite has always been the Limited Liability Company (LLC). It is fast, inexpensive, and gives individual shelter. 

Additionally, in which state are you going to register to conduct business? Are there any state or local licensing requirements? All these questions should be answered in your business strategy. A number of you might be thinking,"I will purchase foreclosed properties, rehabilitation them, and offer them for a profit. What additional explanation or intending do I want?" 

Well, if this is the mindset, then stick to your fulltime occupation. I suggest going online (Google it) and downloading a business plan template to help you with development. Besides your business strategy, you have projected financial statements, such as a cash flow forecast, projected income statement, and expected balance sheet. 

There are many benefits of creating these statements. Clearly depicting your annual operating expenses permits you to recognize the amount of property transactions you want to successfully complete so as to break even and/or realize a gain. Taking the time and effort to execute these tasks can allow you to overcome some of the significant impediments when starting your property business. 

The largest recurring mistake I have seen amateur entrepreneurs make is quitting their fulltime job even before finishing their own first real estate deal! Undercapitalization is one of the biggest oversights when beginning a new business. Should you decide to quit your fulltime job, be certain you have enough of a financial pillow to cover your living expenses for twelve weeks. 

Ideally, you want a surplus in your bank accounts so as to finance your business (i.e. - thing formation fees, licensing, marketing expenses). Finally, are you going to be self-employed or a business owner? No, they're not the exact same thing! Becoming self-employed means when you stop working, your business stops functioning.

If you aren't marketing for prospects or answering phones, then nobody is. Being a business owner (hiring and keeping employees) enables the freedom and liberty that lure people to start their own businesses in the first location. Most amateurs quit their fulltime job hoping to start and sustain their own business profitably, while playing golf or going to the beach four days each week.

 WRONG! The transition from self-employment to business ownership is the toughest obstacle to overcome. It took me nearly a year of interviewing hundreds of job applicants, working fourteen hour days, pulling all-nighters, and sacrificing my personal and societal life to successfully build and create all my businesses to the point where they could all run on"Auto-Pilot. "Remember, a business is only as strong as its weakest link.

Bayverse!anon again I'm a bit disappointed in both fandom and film makers that the tragedies shown in the movies are not being discussed more in depth. I have nobody who cares enough about the franchise to discuss anything except the "explosions", but that's why I appreciate your insight. There was something about the movies that left me with a weird feeling. You put it into words when you explained that the Transformers are facing extinction. Having seen TLK recently, I noticed that P ½

P 2/2 Optimus and Megatron’s actions can be seen from different perspectives. No doubt Optimus is the better person of the two. However, if I was a Transformer there is a chance I could side with Megatron especially after AoE. During the last fight in against Quintessa one of my thoughts was: if I was a Transformer desperate and angry enough I would probably let her? This is what makes the theme of extinction so interesting. It has no solution. And at the end of the film nobody is really fine.

Hm, I’ve heard similar arguments for Megatron, including Tyran Megatron. However, I find it is an error in judgment for a variety of reasons beyond the “Well, Megatron is the worst.”

Cool motive, still genocide—

Megatron never wants to rebuild Cybertron. Well, he never wants to rebuild Cybertron. He always wants to rebuild it in his image; it is a Biblical theme of of some divine entity exerting influence over another and reforming them to mirror their own.

The other issue the same as with Sentinel and Quintessa: they want to rebuild Cybertron, which they will rule as they see fit, at the sacrifice of another plane (see: Earth). Many Autobots would love to have their world back, but this is a faction that has almost the same philosophical loyalty to Optimus as the Decepticons (when it was convenient for them or the writers) had with Megatron. In the end it is about the motives: selflessness vs. selfishness.

Optimus’ desire for Cybertron is legitimately about the continuation of his people. This is his homeworld. He fought in the tribal wars and he helped unite them. He helped to build the Empire as it was in its last age, arguably one of its golden age if not for the pesky problem of energon resources steadily beginning to run low—think of our climate change and how it started small, scientists were warning us, and now it is sneaking up at us at a rapid pace. But back to what I was saying about how Optimus genuinely loves Cybertron. He doesn’t love himself. He doesn’t love the power. He doesn’t see Cybertron OR its people as a tool for himself, he sees himself as a tool for Cybertron and its people.

Before Megatron’s faulty motives is explained in the context of his back story and past before, I must clarify one important fact about Tyran Cybertron:

Cybertron had two real divisions in their society: civilian and military.

This shaped everything. From the macro level to the micro. Megatron was the leader of the military, and Optimus was the leader of the civilians.

Cybertronian civilians have taken a vow to give up their violent ways. Referring a previous anon, it was explained how the Cybertronians are naturally violent. As a test of their free will many Cybertronians took that vow as a way of making amends for the tribal wars that came to follow. Think of it like this: it was almost like half the population took a vow of silence. But, instead of silence, it was to abstain from violence. Another fictional analogy would be to refer to the history of Star Trek’s Vulcans, who also had a history of extensive conflict until they were led to peace through a vow of logic. Monk’s (may) give up their speech, Vulcan’s get rid of their emotions, and Cybertronians gave up violence. It was a societal addiction and they went all or nothing. So, military went all out and the civilians had none of it.

This distance from their violent past was crucial to the civilians, and one reason why Optimus was chosen to be their leader beyond reasons of “Oh, he’s a Prime.” It is because he was the first leader to show any ability to be peaceful; he gave a speech on a battlefield that swayed the sparks of many, and Ironhide was the first to preferably lay down his sword. The laying down of sword for the civilians was everything. They would struggle like any addict, and one way they managed it was clearly defining the differences between those in the military and those not.

As leader of the military, Megatron’s job was to led those will indulgent in violence to use that in a way that protected Cybertron and freed the civilians to… well, more civil pursuits.

Thus, Optimus became Prime and Megatron became the “High Lord Protector.” However, originally he was to solely be referred to as the “Protector.” But notice that in his official title “High Lord” is added on. Why? Was that already there? No, it was there at Megatron’s behest. He wanted to still Lord over people. 

When the energon famine really began to be a clear and present danger he argued with Optimus, the civilian leader, that the resources should be rationed and diverted predominantly to the more “stronger” Cybertronians and the weak should be left to fend for themselves. Notably this is a primal way of thinking, and isn’t without some basic evolutionary logic. However, as Optimus ascertained they are not wild animals. They are sentient—the strong should PROTECT the weak. Although it could be said Megatron wanted to keep the resources for the “most likely to survive” had some logic, it loses that rationality when put into the context that Megatron’s motives were that the strongest Cybertronian’s were the military—which was directly under his control. On the other hand, the civilians (Optimus’ part) was considered the weaker. This would leave Megatron with total control of Cyberton, and Optimus would have no legitimate influence to help curb Megatron’s worst qualities—qualities that Sentinel constantly criticized.

With the leaders unable to come to a settlement the struggle began as a cold conflict working behind the scenes. As it could be surmised, it was Megatron and his supporters who had more subversive means of getting their way while the leaders were officially in a morally grey stalemate. Officially their factions were given equal share of the resources and the leader would divide the resources among their faction as they saw fit. Megatron the strongest, Optimus everyone.

At that time Megatron claimed to agree with Optimus on one thing goal in the meantime: finding the AllSpark. It is important to note that before becoming Prime, Optimus had previously been an archeologist. Now, the military has no archeologists, and Optimus was the senior most archeologist on Cybertron. So, according to the laws of the land the hunt for the AllSpark fell directly under Optimus’ purview, not Megatron’s or his military. This was salt to rub in that Megatron was just a violent soldier, the fiercest and more volatile of them all. In the military this gave him respect, but the civilians did not respect that.

Respect was something Megatron struggled with, and it was one of his emotional hot buttons. The two (spark brothers) had been groomed and mentored by Sentinel—he was something of a father to them. The two absolutely adored him. Sentinel loved Optimus, even if he was frustrated with Optimus’ absolutism about sticking to his personal virtues. Optimus was perfect, could really do no wrong, and Megatron was a failure in comparison because he was such a brute. At least, that is how Megatron saw Sentinel’s treatment of them and honestly he wasn’t far off. Sentinel was cruel to both, though in different ways. Most of the time he was groomed into a sense of security and trust in loyalty, given positive feedback if he pleased Sentinel. His mentor would manipulate him in the most seditious of ways. If Optimus went against his wishes.Sentinel was passive-aggressive of just nasty, making Optimus feel like he wasn’t living up to him—he was a disappointment. But Megatron? He got smacked around, physically. He was always scolded and treated like a rabid dog that failed. In the end, both wanted Sentinel’s approval.

Now, the relationship between Sentinel and the dyadic leaders as both a singular unit and individuals is important. It shapes Megatron’s motives to find the AllSpark before Optimus. The famine began to ramp up and the quest for the AllSpark began. As mentioned earlier this quest would be Optimus’ job, his responsibility, because he was the civilian leader & a highly respected archeologist. So when the AllSpark would be found… who would get all the credit and the glory? Let it not be forgotten that they wait to fight over the I had already begun before it was even found. Megatron had to get to it first if he was going to become the more powerful of the two, have his military control Cybertron. Yes he cared about Optimus or even Sentinel, but it was not sufficient to stop him from undermining Optimus’ powers. At that time he was torn between completely overthrowing his brother or just asserting dominance with his military.

So, the race to find the AllSpark was off. This was when Megatron found the Fallen’s tomb. Why did he find the tomb? Because he was searching for the AllSpark when according to Cybertronian laws he wasn’t supposed to. The Fallen possessed him, brought out the already destructive traits to the surface and had them completely take over. In the end it was the Autobots who found the AllSpark and the war began.

Megatron has no track record of wanting to rebuild Cybertron for altruistic reasons. His motives were selfish, malicious, and ultimately brought ruin to their world. In TLK Lennox asks Megatron what he wants and Megatron’s answer is, “To go home.”

This sounds sincere, but it isn’t. If it was he would have done what was written in the DOTM’s book ending and that was a call for truce. In the DOTM’s book it ends not with Megatron’s death, instead it is the two reuniting because Megatron realizes that the only way for Cybertron to be rebuilt is if he works WITH Optimus. In TLK he is fighting against Optimus.

Of course, that is when Quintessa comes into play. When Quintessa slaps Optimus she leaves a scarlet mark; the mark of her ownership. Whatever powers are in it have the capacity to begin take control. The mark on Megatron’s face shows exactly who he belongs to, and the best plausibility is that he is Quintessa’s puppet. Her strings with Megatron were probably much the same as with Optimus: the promise of reviving Cybertron.

It is unlike that Quintessa’s revival of Cybertron would have been good for the surviving Transformers.

Note: I will shortly be writing up a headcanon to explain the state of Cybertron as presented in the movie and it will elaborate on what is to follow in this answer.

Cybertronians fear enslavement. They fear it. Yes, we do too. But not all of us have experienced a recent memory of enslavement. Cybertronians do. They also know what it is like to be led by someone that ultimately destroys everything they care about. Many Decepticons didn’t even think far enough about why they were obeying Megatron. They did it out of loyalty or because they get to blow shit up. Autobots, for all their roughhousing and their inclination to interact as we would perceive as violent, they do want peace. They don’t want to have the kind of war Megatron and his Decepticons want. They know they are the last of their kind. They want to sun on the beaches of Cuba and play some volley ball. They are TIRED. Right now all they have is Earth or a dead & rotten planet. Most Cybertronians are going to see a repeat of their experiences: Megatron leading them to domination or the Autobots trying to protect what they care about. One is total destruction and one is just total preservation.

Ultimately, I do not believe most Cybertronians would help Quintessa and/or Megatron revive Cybertron unless they are already a follower of Megatron and inclined to excessive violence for the sake of it. They will see that Optimus and Megatron are on opposing sides and unless they are already a Decepticon… they are going to side with who they trust to not be a planet killer. These are the last survivors—they are experienced, they know better. They know that Megatron’s word can never be taken at face value.

And ultimately, those surviving Transformers who are not already on Megatron’s side are the ones who have lived long enough to value the sanctity of sentient life more than they already did before the war, and that’s saying a lot because Optimus wasn’t the only one advocating for the preservation of sentient beings. This particular virtue isn’t even an ethical one for Cybertronian, but a moral one with practical applications. The original Primes had the law that they could not use the sun of a solar system that had any planets with life on it. The Cybertronians find it aborhant to throw away like that, which puts their so-called violent nature into perspective by illustrating that they, by large, had a clear line on the issue of sacrificing one group of sentient beings for the benefit of another—even their own. Transformers just don’t respect any action calling for the compromise of their most highly valued ideals if committed at the expense of others. They like seeing themselves of guardians of younger alien species.

As you can see I have a lot to say on the matter of justifications of Megatron’s intentions to revive Cybertron. It is a subject that has come up in a few continuities, Tyran and Aligned being chief among them.

In the end I see no way to justify Megatron’s actions that he may disguise as altruism until it is clearly narrated that he has had a redemptive moment of self-insight. i.e. Him at the end of TFP Season 2 and him at the end of Predacon’s Rising.

Trust no bucket until it the truck says so.

DropShipping: The 10 most common startup errors

More and more start-up companies in Germany are using DropShipping to fulfill their dream of their own online business. This is no wonder, because only with DropShipping it is possible to offer hundreds of products for sale in your own online shop or on eBay without having to buy a single product in advance.

The reasons for the failure of young companies are manifold

Whoever decides to found their own company naturally wishes to achieve maximum success with the business. At the very least, this means that the company will survive economically and generate enough money to provide the operator with a comfortable life. If this succeeds, then most of the wishes and dreams that led at the beginning to the fact that one has decided at all for a foundation come true.

If it does not succeed instead, then unfortunately one often has to struggle for a long time with the consequences and consequences of failure. So there is a lot to be said for dealing at an early stage with the question of why young companies fail at all. In this way, strategies can be developed in good time to avoid failure.

If we first take a rather general look at the reasons why young companies fail, we usually encounter gaps and deficiencies in terms of financing. The companies run out of financial breath during the start-up phase because the resulting costs were underestimated and the incoming revenues were overestimated. As a DropShipping dealer, you are more on the safe side here, as there are no special costs during the start-up and start-up phase and no high costs during ongoing operations.

Also DropShippers are not protected against missteps

Scheit can be a drop shipping company of course anyway. Here we often have to deal with very specific causes. These relate partly to e-commerce in general and partly to the drop shipping trading model in particular.

Among the causes based on the general characteristics of e-commerce, the lack of or incomplete market analysis should be mentioned above all. Those who, as founders, do not deal extensively with the potential of the targeted market risk financial shipwrecks. A lack of product knowledge has also brought down many a start-up project. If we turn our attention to those causes that relate specifically to drop shipping, then those reasons that are related to the suppliers are particularly noticeable here.

The manufacturers and wholesalers that DropShipping works with have a great responsibility and are instrumental in determining whether business is developing positively or negatively. Therefore, it is important to look here when it comes to finding and combating the most frequent mistakes at the start of drop shipping companies in advance.

Who knows the worst mistakes, can protect himself consciously and effectively

With founding mistakes, it’s such a thing. This includes the most common causes that can lead to the failure of a young company shortly after its launch. Inexperienced founders have the disadvantage that they often do not know these potentials well enough. This hardly gives them a chance to prepare adequately for what is to come. Unfortunately, one usually only has the appropriate experience when one has been in business for several years.

However, it is precisely then that knowledge about mistakes in setting up a company is of little use. Of course, such founders and entrepreneurs are particularly familiar with the causes of failure, as they have already experienced the economic collapse of their companies. Therefore we should find a way to know the most common mistakes of founders in the field of DropShipping without having to experience them ourselves. If this happens, then it is usually already too late.

Now, of course, one could turn to experienced entrepreneurs and ask them to accompany one’s own founding and start-up process and, above all, to make sure that not too many mistakes occur. The problem, however, is that on the one hand there are not very many entrepreneurs who are willing to provide such information, and on the other hand such entrepreneurs also work constantly rather than devote their precious time to advising and supporting future competitors. In search of a better and more realistic way, you will be interested in the following 10 sources of error, which we would like to present to you and give you along the way.

Successful learning from the mistakes of other DropShippers

We have compiled for you the most frequent and most serious causes of the failure of young companies. We have been guided by the e-commerce industry on the one hand and the DropShipping trading model on the other. Therefore, you do not expect unimportant commonplaces, but instead a very differentiated elaboration of the most frequent sources of error in exactly the business area you have chosen.

We recommend that you study the presented errors, reasons and causes very carefully. Try to internalize the individual sources of interference deeply and pay particular attention to the many recommendations in the text that will help you avoid these mistakes. With this you lay the stable foundation stone for a long-term stable company that is economically well off and provides you financially with everything you need.

You should avoid these errors at all costs

In order for a DropShipping trade to start successfully, it is important to exclude potential sources of error. Below are the ten most common mistakes made by inexperienced DropShipping resellers. Those who take these sources of error into account when setting up their own drop shipping business and consistently avoid them have good prospects of a profitable and flourishing company in the long term.

Error 1: Market and consumer interests disregarded

Products cannot be sold without a reasonable demand on the market and a corresponding interest on the part of consumers. Before you decide on a specific trading area, you should carefully analyze the market potential. In this context, do not only examine whether the respective goods are in high demand, but also get an accurate impression of the competition and the current prices on the market.

If you succeed in discovering a promising niche that has so far been little occupied, then your chances of successful sales will increase. If you have well-founded doubts about the success potential of products, then you prefer to choose a different product area.

Error 2: Too little time is invested in the selection of suppliers

Anyone who’s too quick for a DropShipping Suppliers who risks overlooking crucial details. Every potential drop-shipping provider has to be put through its paces before starting a concrete cooperation. This requires comprehensive research, which ideally also involves personal discussions. One way to get in touch with potential suppliers is through appropriate trade fairs and commercial exhibitions.

Extensively test the efficiency of the potential wholesaler. Make some test orders and especially check the quality of the products and the reliability of the delivery. Question existing customers of the respective supplier about their Experience with DropShipping at the company and search the Internet for opinions and ratings.

Error 3: Conditions with suppliers are not well negotiated

The profit is made on the purchase. Remember this old principle of successful merchants and check the purchase prices of your DropShipping suppliers carefully. Wrong shame in negotiating list prices is out of place here. Your counterpart is an experienced dealer and will not feel attacked by an open request for special discounts and better prices.

However, do not only consider the pure product price, but also agree the costs and fees for shipping and handling with your suppliers. Please also talk about minimum order quantities and any surcharges for small quantities that may apply. These conditions must in any case be clearly agreed before the start of the cooperation, as they are very decisive for your future profits.

Error 4: Products are traded that you don’t understand.

When selecting a product area, you should not be guided solely by market opportunities and achievable profit margins. Make sure that you have as much personal reference as possible to your future product range. Keep in mind that you can describe and document products that you know well much better. As a specialist stranger, the compilation of a consumer-oriented assortment would already present you with an almost unsolvable task.

When choosing a specific product group, remember that you need to answer customer questions regularly, both before and after the purchase. If you decide on products that interest you personally, you will follow the markets, the technical innovations and the trends anyway and will not have to invest additional working time for this.

Error 5: The costs in the DropShipping trade are underestimated

Those who opt for a business model based on drop shipping often have the low start-up costs in mind. Even if this business model requires considerably less capital than a comparable concept in classic trading, you will still have to bear various costs. You should be aware of these and take them carefully into account in your planning. Think, for example, of the software and design of your future online shop and the expenses for programming interfaces to the respective suppliers.

In addition, calculate the costs of setting up your future workplace, creating business stationery and include the advertising and marketing expenses necessary to make your future shop known on the Internet. Although drop shipping allows you to dispense with a warehouse and staff for warehousing and shipping, you should consider early on who can support you in handling customer inquiries and support tasks and what this support will cost you.

Error 6: No regulations are made with return of goods

If you sell products on the Internet to private customers, then you are legally obliged to grant the buyer a 14-day right of return. Remember that this right does not apply between you and your DropShipping supplier. This is due to the fact that there is trade between merchants here and that in this environment the rules of private consumer protection do not apply. Under certain circumstances it may be possible to agree an extraordinary right of return with the DropShipping supplier.

If your supplier is not prepared to do this, you should plan to sell returns on eBay. Keep in mind that you will not normally achieve the originally planned sales price with such returns. Please also clarify with your DropShipping suppliers how to proceed in warranty and guarantee cases. In any case, agree to whom the customer can return a defective product during the warranty period and how it will be replaced.

Error 7: Communication with the supplier is inadequate

In order to convince yourself of the efficiency of a drop shipping supplier of your choice, you should personally and locally get an exact picture of the company of the future partner. Although today a large part of commercial communication is handled by telephone or e-mail, personal contact, especially at the beginning of the cooperation, cannot be replaced by anything else. In direct dialogue, you have better opportunities to negotiate concrete prices and conditions.

In the premises of your potential supplier you can get a comprehensive picture of the seriousness and efficiency of the company. Check whether the products offered are actually in the warehouse and have the processing structures and processes in the company explained to you. Pay particular attention to how quickly incoming orders are processed and ordered goods shipped.

Error 8: The amount of work is underestimated

Online trading via drop shipping involves considerably less processing effort than traditional mail order trading. However, even the modern form of online trading cannot do without planning and structure. It is therefore imperative that you plan in indispensable work steps and increased time requirements.

On the one hand, you should not underestimate the effort involved in the careful care of prospective buyers and customers. On the other hand, the business relationship with your drop shipping suppliers can also involve a greater amount of work if, for example, inventories have to be transferred manually instead of being updated via a data interface.

Error 9: The ability of the goods to be delivered is not checked optimally.

As a drop-shipping online retailer, it is your responsibility to verify the delivery capability of the products you offer. If a product is not available or only available late, this is due to your reputation as an Internet trader. When trading drop-shipping products on eBay, even the seller guidelines oblige you as a seller to make sure that the products can be shipped immediately after the sale.

The consequences of delayed availability of products can also affect you economically. For example, if a customer orders two products, one of which is not available on schedule, you usually pay twice the shipping costs.

Error 10: Goods with high return rates are selected

Product returns are part of the daily routine of every online retailer. Both the law and the general rules for customer friendliness require an unconditional right of return of at least 14 days. In many cases, returned goods can no longer be sold regularly, but must instead be sold elsewhere, usually at a lower price. The resulting losses are to be borne by the online merchant himself.

Against this background, the product areas envisaged should also be reviewed with regard to the return rate to be expected. The market knows of various product categories which are particularly susceptible to returns and can therefore be classified as unsuitable for drop shipping. An example of this is the clothing sector. Here, the return rates can reach up to 40 percent in some cases.

If you know the most serious mistakes, then you are in the best position to avoid them consistently. To complete the picture, we provide you in our guidebook in addition 7 stumbling blocks on the road to success in front of you. So you are optimally prepared to do everything right.

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Applying equilibrium analysis

Let us now turn to the problem of applying equilibrium analysis. The comparative analysis of success and failure gives us a tool for the understanding of reality that is both realistic and a priori. We have seen that there is no need to prove that people do not or tend not to err, for such a proof is irrelevant for the applicability of equilibrium analyses. All possible cases are covered by the theory of equilibrium prices and its comparative counterpart, the theory of profits and losses. This view is realistic because success and failure are potential features of human action. And it is a priori because success and failure cannot be perceived on the basis of mere sense impressions and thus cannot be validated or refuted by observations. The problem of applying equilibrium analysis, then, is to identify instances of success and failure in the real world.

This problem of identification defies mechanical rules and generalizations. It is the problem of the specific Verstehen of historical investigations. Observation allows us to identify two cars running into each another, or a factory closing its doors, but one cannot see an accident or a bankruptcy. Identification of the latter requires understanding on the part of the historian, who must treat each case on its own. In other words, every instance of success and error must be identified in individual historical cases. One cannot single out some kind of action and claim that, in general, it is successful or erroneous. Rather, its success and failure must be determined by reference to the individual conditions in which it takes place. Saying “Hi, old chap!” might be the right thing to do when meeting a friend. It would most likely be wrong to do so when introducing oneself to a potential employer. Building a football stadium might be profitable in a prosperous society. It would most likely be a waste of resources if the society went to war and the population starved. To be sure, one cannot explain success and failure as a necessary consequence of the conditions of action. Introducing oneself to a potential boss, one can do the wrong thing and say “Hi, old chap!” even if we would qualify such behavior as either silly or pathological. Implied as possibilities in choice itself, success and failure are possible under all conceivable circumstances. Man can choose the most important of realizable alternatives, but can also fail to do so.

However, once a choice is made, its success or failure depend exclusively on the circumstances of the individual case. In other words, before a choice is made its success or failure is self-determined, and all other conditions of action are irrelevant. After the choice is made its success or failure depends exclusively on empirically given conditions. One has to look to see whether the chosen action was indeed the most important one among the realizable alternatives, or whether it rendered impossible the performance of a more important action. Only in the first case could we speak of success; the second would be failure. Applying our a priori equilibrium analysis, we make errors intelligible by comparing their implications to the implications of better courses of action that could have been taken. Or ,we make successful action intelligible by comparing its implications to the implications of erroneous actions that could have been taken. Again, the important point is that equilibrium analysis can be applied only by reference to concrete conditions of the individual case. One has to identify other concrete actions that would have been possible and determine whether they would have been more important. In short, one cannot apply equilibrium analysis by reference to any a priori standards. The standard of comparison must be a concrete action that also could have been performed in the same concrete historical situation.11 We will discuss the problems of identifying such actions in the remainder of this section.

The crucial problem in applying equilibrium analyses is a twofold lack of evidence that concerns both, the value scales of acting persons and the possibility of alternative actions.

These problems are particularly difficult to solve in Crusoe economies—that is, when one analyzes the actions of isolated persons. One can observe Crusoe’s actions, but cannot observe his value scales or what he could have done instead of what he did. The only way to deal with such cases is to guess what he might have tried to do. Except for instances of what strikes us as pathological behavior, we will have to assume that he wanted to produce the effect his behavior brought about, thus assuming what is commonly called “rational” behavior on his part. Still in our interpretation of his behavior, we will sometimes suppose that he failed to pursue the most important project, namely, when we are convinced that he acted against his own rightly-understood interests. We then look at him as a mother looks at her child when it does something that strikes her as stupid, or as a benevolent dictator looks at his subjects when they behave in a manner he deems improper. We could also suppose that Crusoe has failed if we know of a better alternative action by which he might have tried to attain the same end that he supposedly attempted. Again, we assure the perspective of enlightened parents or of a higher civilization. There is only one way to establish some (although insufficient) evidence about Crusoe’s value scales, namely by relating his currently observed actions to his past actions. If we assume that his value scales are by and large stable over time, we can interpret a change of behavior as a discovery of past error (but to be sure, it could also be interpreted as a change of value scales).

These cursory observations help us draw two preliminary conclusions. First, we get a glimpse of just how muddy the waters of such historical analysis are. Nothing is left of the clarity and apodictic certainty that characterized our theoretical exposition. Although we are certain that there is only one historical truth (because to assume otherwise would be contradictory), we cannot prove that we have captured it. Arguing our perspective on Crusoe’s value scales and the alternatives he faced, we cannot refer readers to an objective basis they cannot circumvent. We can only try to understand, and try to make our understanding intelligible. Second, we also clearly see that all assumptions about stability of value scales, “rationality,” homo oeconomicus, etc. are nothing but crutches for historical research. They have nothing to do with economic theory, entering the scene only when necessary to apply economic theorems to understand concrete reality. What economics has to say about equilibrium is apodictically true and, as we shall argue in more detail, highly relevant for a correct assessment of the political significance of profits. However, as far as our understanding of real-world action is concerned, equilibrium analysis merely gives us a few—although valuable—tools. These tools need to be complemented with empirical ad hoc assumptions that spring from our personal understanding of each case under consideration.

One can derive still further insight from the case of the Crusoe economy. One of the problems of applying equilibrium analyses, we have stated, is in establishing the value scales of the acting person. We can exclude one view of his value scales from the outset, namely his own view at the moment of decision. The reason, of course, is that at the time he is convinced he is performing the most important action. He does not err intentionally, and he could not do so if he tried. Even if someone consciously brought about a “failure,” it would be no failure at all. The very fact that the action was intended to produce an ostensible failure implies that it was a success. For example, let us suppose that it is my intention to bring about a failure by jumping from the top of a skyscraper and smashing myself on the ground. If I am smashed, I have not proven that one can err intentionally, for it was my very purpose to be smashed. My action was successful. What we see here is that, as a phenomenon, error can occur only ex post an action (see Menger 1871, pp. 21ff.). If the effects of action did not spread in time, all would be present in the very moment of choice. There could be no difference between expectation and reality, we would thus always engage in the best possible action, and there could be no error.

Equilibrium analyses, therefore, cannot fruitfully be applied by referring to the acting person’s ex ante perspective on his own value scales. However, once a choice is made, any person can meaningfully analyze this choice in equilibrium terms. One does not have to resign oneself to contemplation and wait for all the effects the choice will bring about. Both acting persons and outside observers can criticize the choice, pointing out that it is not the most favorable that could have been made. Business observers in newspapers and journals, for instance, do this all the time.  Instead of waiting for evidence of the error to manifest itself they anticipate it. This kind of critique is legitimate because error manifests itself ex post an action only insofar as it is a phenomenon, that is, only insofar as it is evidence of our senses. Objectively, however, error is always manifest in the very action that brings it about. From the sole fact that no acting person thinks he errs, one may not infer that there is no such thing as error or, to take a more specific example , that markets are always in equilibrium. Thus, error is revealed in ex post deviations between plans and reality. But these deviations are not errors themselves, only their manifestations. Error is committed in decision itself. As soon as a decision is made, that is, as soon as choice becomes an ultimate given, a legitimate critique can set in and offer recourse to the terms of equilibrium analysis.12

Now let us turn to the application of equilibrium economics to analyses of entrepreneurs in a market economy. The first thing to emphasize is that we are still interested exclusively in the success or failure of individual actions. It would be groundless to argue that the choices of other market participants determine which of our actions are right or wrong, for this does not affect whether our actions actually are right or wrong. General equilibrium is reached when all individuals choose what is for each the most important course of action. We do not have to bother with the question of whether general equilibrium is ever reached, however, as long as we are sure that it can be reached.

Fortunately, one can neglect the question of whether other market participants, consumers in particular, act according to their best interests. Their actions are data for the entrepreneur under consideration. He has to adapt his actions to prevailing conditions, and the choices of other market participants are part of these conditions. Analyzing the individual actions of entrepreneurs on the market, we enjoy the considerable advantage market action affords in yielding evidence for valuations and alternatives. When Jackson exchanges ten ounces of gold for Jefferson’s car, we can infer that Jackson had the chance to keep his gold or sell it to somebody else, and that Jefferson could have kept his car and put it to other uses. Moreover, we know that Jackson valued the car more highly than the gold, Jefferson valued the gold more highly than the car.

Most importantly, however, we know that action on the market determines several types of income, and that one such type is profit and loss. On the market, the error of an entrepreneur leads to monetary losses. The returns he realizes for his product do not cover what he paid for capital goods and interest. In other words, the prices he paid for his factors of production were excessive in comparison to his returns, which, in short, constitutes his error. Paying “excessive prices” means that he would have been better off not exchanging his property at all, or purchasing other factors of production and engaging in other enterprises. This way, he would have either realized higher returns, or avoided losses. Similarly, the existence of profits is also an infallible sign of error, for it demonstrates that other producers could have done better by engaging in the profitable activity. The existence of profit implies that some market participants would have been better off making other investments, just as the very existence of loss implies that it would have been wiser not to engage in this (or, eventually, any) market transaction. Moreover, it is clear that the market compares the action of the individual entrepreneur not only to the alternatives he considered when choosing, but to the alternatives constituted by the activities of all other entrepreneurs on the market. This is the market’s ruthless quest for economic truth. Consumers constantly compare products of entrepreneurs by selecting only the most important ones.

Even on the market, though, evidence for success and failure is not absolutely clear cut. Even in the realm of money calculation, where the categories of wage rate, interest, and profit and loss are especially precious tools, one must guess the entrepreneur’s value scales, as well as the alternatives he faced, to establish which part of his income is profit or loss.

Consider the case of two ice cream dealers selling the same product—which buyers also perceive as the same product—at different prices. The one with the higher income sells in front of a school, the other in front of an old-age home. Let us analyze the impact of value scales on this situation from two sides. First, suppose that the second dealer hates teenagers. In this case, as we shall see, his behavior might not involve error. Selling in front of the school would increase his monetary income, but reduce his psychic income, and it is the latter which counts. We might identify error on the side of other persons who could have sold ice cream in front of the school, thereby increasing their psychic income. We might also find that there is no other person who might successfully step in to sell ice cream in front of the school at a lower price. In this case, there would be no profit in the present dealer’s monetary income. All of his receipts would be wages for his specific labor services.

Now suppose that the students love the present ice cream dealer. They will buy only his product, and would renounce ice cream altogether rather than buy it from someone else. Again, there might be no profit in his income, only wages. Without reference to the value scale of potential customers, one cannot tell whether an action on the market will represent profit or loss.

Let us now consider the problem of standards of comparisons. The central difficulty is in gauging whether other market actions would have been economically realizable. When analyzing the market, we enjoy advantages arising from the fact that the actions of other market participants sometimes provide the evidence necessary to solve the problem. Consider again the case of our two ice cream dealers. The fact that both sold the same product permits us to say that both could have sold at either place. We can tell the dealer selling in front of the old-age residence, “Look, you could have taken your car and sold in front of the school.” Yet, again, this evidence does not enable us to make apodictical judgments, such as in the field of pure theory. For it is possible that no other dealer than the present one could sell in front of the school. (The present dealer might be the only one strong enough to defend himself against a gang of nasty schoolboys, for instance.) In this case, there would once again be no profits in his income, merely wages for his specific labor services. Thus, the fundamental difficulty is that we cannot provide clear-cut evidence to answer the question of what the person under consideration might have otherwise done. The very fact that he did what he did prevented him from performing other actions and thereby demonstrating what he might have done. There can be no empirical evidence for his specific alternatives, because there is no evidence for the counterfactual.

Apart from this problem, there are questions as to which kind of alternative action should form our base for comparing market actions. Should it be an action that the decision maker considered at the moment of choice, or should it be any better action, even one he did not think of when choosing? Consider the case in which two groups, while ignoring each other, exchange the same good at different prices. Is this a case of error, or not? According to Stephen Shmanske (1994, p. 210), “this market is only in disequilibrium with reference to some perfect information benchmark; this perfect information does not exist in the hands of the relevant actors in the market and, therefore, is irrelevant.” Shmanske concludes that the market is in equilibrium—that is, that no error can be identified. Israel Kirzner (1985, p. 158f.), by contrast, sees here a case of disequilibrium. Who is correct?

Remember that we can use the distinction between success and failure as an analytical tool for comparison. It is obvious that, in the case cited above, the group selling at a lower price could have sold at a higher price somewhere else. We can therefore meaningfully compare their actual actions to actions they did not consider when making the choice. This is a common practice of daily life. With the benefit of hindsight, we look at a choice and compare what has happened to what could have happened if we had made other choices. We might be able to “forgive” ourselves more easily if we look back convinced that we did not even think of other actions at the time. (As an outside observer, one of course has the additional difficulty of finding evidence that the alternative really was considered.) However, this does not change the fact that one can meaningfully compare past actions to alternative actions that were ignored at the time of the decision. A completely different question revolves around which importance should be accorded the errors we so identify. Everyone might judge for himself whether this kind of comparison is relevant or not.

In retrospect, one always finds evidence that puts past decisions in a new light. Although in many cases it might be difficult to say whether our past actions have indeed been successful, such difficulties do not at all invalidate the fact that there is always a best or optimal action. They often stem from the reality that not all effects of our actions have as yet become visible. We often have to wait to see whether our past judgment was or was not the best possible. If we wait long enough, we shall always be in a position to gather evidence to gauge whether or not we chose the most important action. For example, investments that at first seemed to be ruinous can eventually realize important returns. And even the most initially promising enterprise might go bankrupt because of unforeseen events. If, looking back, we find no fault with our past decisions, if we find that we always chose the best option possible, our life has been optimal. And if, in retrospect, we discover errors, we are only capable of identifying them because we can conceive of a better alternative that we could have realized instead.

The fact that the future might produce new evidence for and against the success of past endeavors implies that the standards of comparison by which we gauge such success are constantly being modified. What was formerly considered the best option now seems only second-best, or, in other words, wrong. We see it as wrong now because we realize that carrying it out prevented the execution of a more important alternative. What does this imply for the writing of history, as far as history is an application of economics? It implies that history must of necessity be “revisionist.” It criticizes our old view of what was right and wrong in light of the new evidence. Although we always employ means that, in our ex ante judgment, realize the most important end, we sometimes discover ex post that another course of action would have been more favorable. We then see that our ex ante judgments deviated from what events now show us was reality. This deviation is the manifestation of error. Ex ante, we always choose what we think is the most important option. Ex post, we compare what is with what would have been, and thereby discover our errors.

It would be groundless to object that this conception of success and failure is too restrictive, that it would lead to every plan being thwarted except that made by a clairvoyant or a very lucky planner. As should be clear from our foregoing discussion, equilibrium is nonetheless realistic, and nonetheless important for economic analysis, even if nobody attains it.

The purpose of the foregoing discussion was to highlight the intricacies of applying equilibrium analysis and to contrast it with the result that this kind of research can bring. Instances of proper applications can be found in investment newsletters and business reports as well as in biographies of business executives and other leaders. Let us emphasize that these applications do not add one iota to the political debate surrounding profit, income, and distribution, however. This is not because applications of equilibrium analysis refer to individual cases instead of to the economy as a whole, but because applications themselves teach us nothing about the nature of profit, but rather use this category as a tool. Theory, not historical applications thereof, must guide us in political decision making.

— Jorg Guido Hulsmann, A Realist Approach to Equilibrium Analysis

The trickiest thing about tumblr is its level of anonymity, and the ability it gives a person to not be entirely truthful about who they are. You can be whoever you want to be! Nobody will know. You can roleplay anyone and no one can question you. In most cases, this is a good thing. Protecting one’s privacy is important, especially online. But in a lot of cases, it creates awkward situations where you might need to question the legitimacy of someone’s claim because they’re dropping red flags that they’re lying just to have an excuse to be abusive and avoid criticism, but in doing so you risk being labeled -phobic or -ist or a horrible person in general for daring to invalidate someone’s experience or abuse.

so when I see someone throwing a tantrum all over ship tags and equating shippers with pedophiles, while blatantly misusing that word in the same sentence as claiming to be CSA survivors themselves, that really makes me doubt that they’re being entirely truthful about their trauma, and that they’re likely just making up some story out of the mistaken assumption it will add some legitimacy to their false accusations. If you were really a victim of child sexual abuse, you wouldn’t belittle it so candidly just for a cheap attempt at policing strangers on the internet, you wouldn’t exploit it as a manipulation tactic, and you’d have a little more respect for the term (and actual survivors of it) and use it appropriately.

that goes for the transtrender thing too. Believe it or not, I dislike transphobes and terfs as much as the next guy, but when it seems like being a trans guy is the new iteration of last decade’s empty boast of “not like other girls”, and then seeing so many teenagers on here who have clearly never experienced dysphoria in their lives and are solely using that identity as a means to shit on girls for shipping the wrong ship and backing up their reasoning with “well AS A GAY MAN~~ I’M TELLING YOU HOW STUPID YOU ARE BECAUSE I’M TOTALLY A GAY MAN THEREFORE I’M THE ULTIMATE AUTHORITY ON GAY MEN,” you’ll see why I’m so doubtful of a lot of people about who they claim to be. I doubt actual trans men would dedicate such a large portion of their leisure time to yelling at strangers on the internet over inane trivia, because I’m assuming they’d have bigger fish to fry, and actual real life problems to worry about. And probably also a considerable level of empathy on the subject of bullying and harassment, so…needless to say, that sort of behavior would likely be, erm…beneath them. Also, maybe let’s not appropriate that identity, because I imagine it’s demeaning to actual trans guys and the shit they’ve had to go through when all you’ve done is tapped off a hasty afterthought of pronouns in your bio and then assume to speak for them.

There’s also the implication it carries that it’s apparently a lot more beneficial on this site to be othergendered than it is to be female, that we’re still stuck in this shitty online culture where being female is still considered unfashionable and the Absolute Worst Possible Thing a person can be and that claiming to be anything but female is ideal, but that’s a conversation for another time. It’s just, illuminating, I suppose. 

Don’t think I don’t feel bad for pointing this out. I really don’t intend to invalidate anyone’s identity or past abuse, but when it seems like most of you are simply using those labels as weapons for the lone purpose of being huge steaming shitbags to people in fan spaces, you’ll understand why I can’t really take anyone seriously, and why my knee-jerk reaction on this site is to immediately disbelieve that anyone is really who they say they are and not just catfishing for catfishing’s sake. It’s a red flag that goes up whenever someone makes claims as to their identity or education or general worldly experience, when everything about their personality and claims suggest otherwise. Like CSA survivors misusing the word pedophilia, presumed law students making serious accusations of federal crimes with absolutely no evidence to corroborate it, trans people whose only motivation to be on this site is bullying and harassment. 

Pardon if I’m way off base here, I don’t mean to assume what might be considered “normal” behavior for any of these groups of people, but these traits seem a little out of character for those identities, so you’ll forgive me for my skepticism. I think a lot of people here are exaggerating a little about who they say they are. I know it must have been unpleasant, but accidentally stumbling across your parents’ porn stash doesn’t make you a CSA survivor. Occasionally attending a paralegal night class at your local community college for burnouts and recent divorcees doesn’t make you a law student. If you really want to make a convincing case for any of these things that you kids are impersonating, you need to start…well, playing the part a little more convincingly. You’re too obvious in your lie. 

So just a little litmus test the next time you find yourself arrogantly opening any rebuttal with “As a _______, I’m telling you with unassailable authority that you’re wrong/immoral/harmful for liking this thing”, perhaps delete that and try again with something a little more substantial. Because for any of you that haven’t yet made it to sophomore-level debate class, that is a fallacy called “Appeal to Authority,” and it fails from the start because it assumes an individual’s dubious claim on an identity/experience gives them justification to speak for all people in that group. 

This is flawed because it doesn’t rule out the imperfections of personal bias or intersectionality. Instead of using your identity to condescendingly explain why you’re right, try using factual evidence or actual statistics from reliable sources and studies rather than anecdotal evidence. We’re in a post-truth world now (in case any of you haven’t peeked out from under the tumblr-echo-chamber-induced rock you all obviously like to hide under and haven’t noticed), and you’d do best to not contribute to it if you want anyone to take you even remotely seriously when you claim to represent the rights of all those innocents and Others that make up the downtrodden minority of society. Just remember, anecdotal evidence cannot be proven, and it’s useless because literally anyone can just make up some bullshit and apply it to a situation to make themselves look right. 

You know who else does this? Donald Trump. Donald Trump and his lackeys. This little missive is directed mostly at fandom antis, but this can apply to anyone on here who claims to be of any left-leaning persuasion: maybe don’t do that, because you start looking like the very people you claim to oppose, and it weakens every argument you’ll ever make. And I have faith in all of you, that you’re better than that. That you’re smarter than that. Even if your anecdotal evidence is true, it’s inadmissible because it can’t be proven. And it shouldn’t be, for that matter, because you don’t owe that to anyone. All it’s going to do is result in some asshole at some point coming out with their own anecdotal data that’s made up or highly embellished for the sole purpose of belittling yours, and then you’re at an impasse because A) you just spilled your most painful, humiliating memories in vain and B) you either have to acknowledge both accounts or acknowledge neither, and everybody loses. You’ve achieved nothing.

So we’re not here to play oppression olympics or win edgiest blogger award. There’s this really gross thing about tumblr where people are pressured into exposing their traumatic histories and deeply personal information in order to validate enjoyment of their fucking hobbies, and in turn it inspires the children harassing them to “beat the score” or whatever, and that’s when you have them firing back with really dubious accounts of their own, more seriouser trauma that makes them totally righter than you!!! (and is in actuality just a regurgitation of a Law & Order episode they saw once, and very obviously never fucking happened). Fake Tumblr Stories are everywhere, we all know this, we’ve all encountered plenty, but you’re not allowed to question the veracity of any of them or you risk being labeled an abuse apologist or victim blamer or something.

That’s fucking psychotic. Someone shouldn’t have to bleed their darkest moments to some snot-nosed 16 year old brat just to keep from being harassed or falsely reported as a pedophile, and some asshole who arrogantly self-identifies as the fucking moral police shouldn’t be so obsessed with getting the last word on trivial nonsense that they feel obligated to play this woker-than-thou pissing contest with people who have experienced *actual* trauma. I mean, do you kids not see how completely unhinged this behavior is? You children need to be fucking sedated. You’re goddamn nuts. I fear for the day we have to rely on you assholes in the job market, because you’re just gunna fuck everything up. You’ll always be failures. You’ll make a trainwreck of everything.

For lack of a better word,

Yikes. 

Anyway, the point is just a reminder that your identity shouldn’t be relevant when you’re trying to prove a logical point or have any of your arguments taken seriously, if you really are right or justified in your stance. If your argument has any basis in sustainable fact, then your gender/orientation/mental illness/personal history will have no impact whatsoever. So lying about them really isn’t worth it and gains nothing. Just be yourself! I know at the tender ages of ~14-20 you’re desperate to be recognized for how unique you are and you’re struggling to be celebrated as a special individual when you’ve done absolutely nothing, but realistically…that’s a pretty tall order, there are like 7 billion people on the planet, so nothing you can make up about yourself will ever really be that impressive. Stop trying so hard and enjoy your fucking childhood.

And if you find you can’t make a stable argument without using a desperate appeal to authority like that, then maybe you should reassess your stance on things because chances are, it’s because you’re wrong. 

Bankruptcy Lawyer Riverton Utah

When you need help to file bankruptcy, or someone has filed bankruptcy on you, call Ascent Law for your free consultation. We have bankruptcy attorneys on staff who are very familiar with the court process and can help you. Creditors in a Chapter 11 bankruptcy can play a vital role in supervising the role of the liquidator. In a Chapter 7 or 13 case, not so much. If you are a creditor in a Chapter 11 bankruptcy, hire the services of an experienced Riverton Utah bankruptcy lawyer to represent you.

How best to supervise the liquidator depends on the facts of the Chapter 11 case. A smaller case is likely to require less sophisticated supervision than a large one. A case in which the liquidation process is complex and multifaceted requires more supervision than one involving a small number of assets or just one or two items of litigation. If the debtor conducts a business preconfirmation, which is consistent with post-confirmation liquidation (e.g., sales of land in a discreet development), less supervision is required than if liquidation were not within the debtor’s ordinary business activities.

Protection of the Liquidator

An experienced Riverton Utah bankruptcy lawyer will ensure that the liquidator discharges his responsibilities in a fair manner and as required by Utah bankruptcy law. One of the liquidator’s first responsibilities is to ensure that the liquidation process and the representatives of creditors who conduct it are protected from unwarranted lawsuits. This requires a balancing of goals. On the one hand, lawsuit insulation is needed to provide assurance to the liquidator and the creditors that actions taken in good faith and furtherance of the liquidation process will not result in personal liability. On the other hand, creditors must, of course, have some recourse against a dishonest or incompetent liquidator. Finally, in certain situations protecting the estate and its representative from parties outside the liquidation process is more important than protecting parties within the process from each other.

The first problem area is the potential for litigation involving the liquidator’s conduct of the business, either pending or during the liquidation. The plaintiff may be either outside or within the process. A liquidator operating a business after confirmation of a plan of reorganization is susceptible to suit if he or she commits a tortuous or contractual wrong in connection with the operation of that business. A liquidator might also be attacked for his or her wrongful conduct of the business by one of the beneficiaries of the trust.

The liquidator might also inherit problems from the Chapter 11 case itself. For example, the liquidator may be responsible for holding assets with environmental problems. If the liquidator fails to handle these matters properly, he or she could be held personally liable for violations of environmental laws. Similarly, the liquidator who is not the Chapter 11 Trustee may be held liable for a failure to pay taxes or other governmental claims.

The plan of reorganization and other enabling documents should limit the liquidator’s liability to wrongful conduct that is willful, reckless, or grossly negligent. This type of provision is customary and the only practical protection available. The plan and other enabling documents should also provide for indemnification of the liquidator and others who may be vulnerable to suit for his or her conduct after confirmation of the plan.

Directors’ and officers’ (D&O) liability insurance may be available to the liquidator and the group governing the liquidator’s conduct. Ordinarily, D&O liability insurance is expensive to obtain for a debtor who is fresh out of Chapter 11 and undergoing liquidation.

To the extent that money or property come into the liquidator’s possession, he or she should be bonded. While these bonds are expensive, a creditors’ committee that fails to require a bond for a liquidator may find itself subject to criticism (and perhaps a lawsuit), if that liquidator breaches his or her trust.

Liquidator’s Attorney-Client Privilege

The liquidator has the ability to assert or waive the attorney-client privilege on behalf of the debtor. Problems arise when one or more members of a creditors’ committee does not fully understand the importance keeping matters discussed within the committee confidential. In the early stages of the liquidation, a liquidator and supervisory creditor group should determine what information will be disseminated to committee members and when it will be disseminated. The committee may want to restrict certain areas of confidential information to a subcommittee. Other than that, little can be done except to impress upon committee members the importance of maintaining the confidentiality of discussions within the committee.

Avoiding the Appearance of Impropriety

Liquidators must strive to avoid the appearance of impropriety. Typically, the liquidator is overseen by a group of creditor representatives. Usually, the largest creditors are on the supervising creditors’ committee. Frequently, one of these creditors has a substantial issue regarding the validity or enforceability of part or all of its claim. This individual creditor may well have both the ability and desire to intimidate the liquidator in order to discourage an objection or to receive other favorable treatment for its claim. A liquidator in this situation clearly has a problem. Certainly, the governing documents need to be drafted in such a way that the liquidator will not be discouraged from objecting to any particular claim, especially the claim of a creditor sitting in oversight. This issue can be dealt with in one of several ways. If necessary, court intervention can be requested. A less expensive solution is to require a substantial plurality of the oversight committee members to object to compensation. In the event that plurality is achieved, the governing documents can also require that court advice be sought. A practical and efficient way for the liquidator to handle this situation is to be very open and thorough in communicating with the members of the committee. Communication is the key here. All of the objections to the large claims should be communicated to the full committee in order to head off this issue in advance. The liquidator should communicate equally and completely with each one of the members of the governing body of creditors. This approach should help avoid a confrontation with one of the substantial creditors sitting in judgment of the liquidating trustee’s fees.

Funding the Liquidating Trust

The liquidator and the creditors frequently discuss how much money to hold and how long to hold it. Taxes can be an important issue. The first amount is set aside, after consulting with the trustee’s tax advisors, to cover any potentially conceivable tax liabilities until the liquidator is ready to close the estate and all the returns due to be filed have been blessed by the IRS. A delay of several years in closing the estate is not unusual for this reason. The liquidator must also hold back enough to cover all professional and trustee’s fees and maintain reserves sufficient to cover other liabilities that might be assessed against the liquidator. While maintaining this reserve may temporarily diminish the return to creditors, this approach is preferable to the liquidator facing large, personal liability for distributing money to the wrong recipients. In a liquidating trust established for the sole purpose of pursuing litigation, the trust must be funded at its inception with seed money. This amount is set aside at confirmation out of cash in the estate funds and used to fund the ongoing litigation. The fund may thereafter be increased with litigation proceeds as cases are settled or otherwise resolved. The liquidator often negotiates with his or her professionals for contingency fee arrangements or fee caps in order to avoid running out of money prior to the conclusion of litigation.

Compensation of the Liquidator under a Liquidating Plan

Compensation of the liquidator is negotiated in each case. The liquidator is typically identified in advance of plan confirmation. Compensation is addressed in the plan and disclosed in connection with solicitation of acceptances. If the name of the liquidator is not known until after confirmation, the plan should make provision for the negotiation of a compensation arrangement. In this instance, the plan should be flexible so that the committee or other entity empowered to oversee the liquidator can strike the best possible bargain.

The liquidator is commonly compensated on the basis of an hourly rate, an annual fee, a percentage of recovery, or some contingency or progress standard. Which of these ways of compensating a liquidator is best varies from case to case. In general, the larger estates tend to compensate the liquidator on more of an hourly rate, and the smaller estates tend to compensate the liquidator on a success-based formula. Typically, compensation plans provide for a minimum hourly rate. With all but the very largest billion-dollar estates, an incentive, or “kicker,” is used to motivate the liquidator to maximize the assets available for distribution. The incentive may be based on a percentage of the amount of money distributed in the estate or on the percentage of recoveries of the creditors under the plan. Obviously, the facts of each particular case control the weightings of compensation between hourly and contingency formulas. A prospective liquidator may decline the appointment if the method of compensation is not satisfactory. Flexibility on this particular issue is important. Without flexibility, persons who would otherwise be well suited to perform the role of liquidator may be unobtainable, resulting ultimately in detriment to the estate. The most effective liquidation is not necessarily the cheapest.

Compensation of the liquidator should be subject to some controls. Chapter 7 and Chapter 11 trustees are clearly subject to court control of compensation. The compensation of any other type of liquidator is subject to court scrutiny only when provided in the plan. The liquidating plan of reorganization should include a mechanism for review of the liquidator’s compensation under certain circumstances. Usually that mechanism relies only on the participation of the creditors’ committee or other oversight body. Court supervision is not usually required.

Duties of the Liquidator under a Liquidating Plan

The liquidating plan of reorganization should clearly define the liquidator’s functions. These functions are similar to those duties of a

Chapter 7 Trustee

While the functions may vary from case to case, the liquidator is expected to perform six general categories of duties: (i) protection of assets, (ii) operation of assets (to the extent appropriate), (iii) liquidation of assets, (iv) investment of funds, (v) administration of claims, and (vi) reporting to stakeholders. But much more flexibility is provided to the liquidator for performing these duties under a post-confirmation liquidation.

Protection of Assets

The goal is to maximize the present value of the cash proceeds of the estate which will ultimately be available for distribution to creditors. The liquidator must take whatever steps are necessary to protect assets of the estate. As in Chapter 7, the first task of a liquidator is to review the property of the estate and determine what steps need to be taken regarding maintenance, protection, and insurance. To the extent that such issues can be foreseen, the plan should provide the liquidator with general guidance in this area, as well as establish a procedure for making extraordinary decisions, such as the discontinuation of security or insurance.

Operation of Assets

Second, the liquidator may need to operate assets of the estate. Operations should not occur at a loss except under the most peculiar circumstances. One such circumstance arises when the operation of an asset preserves a “going concern” value that greatly exceeds the liquidation value. Another is when large noncash charges cause the operation to show losses for accounting purposes but nonetheless to generate positive cash flow. On the other hand, to the extent that the cost of maintaining assets may be offset by their operation, the liquidator has a clear duty to undertake that operation. The liquidator should have some leeway in overseeing operational assets that are part of the estate.

Liquidation of Assets

While the liquidator should have the authority to operate businesses owned by the estate, his or her true role is to liquidate those businesses sooner or later for the benefit of the estate. The liquidator should have the clear obligation to take appropriate steps to liquidate the estate. The mechanics of liquidation should be clearly set out in the plan. Liquidation by the liquidator without involvement of the bankruptcy court is often preferable. Nonetheless, some buyers, especially in connection with large asset dispositions, want an order from the bankruptcy court (“comfort orders”) approving the sale.

Investment of Funds

The liquidator has the duty to invest the estate’s funds. As a fundamental matter, the plan should provide that the liquidator invest the funds safely. Post-confirmation liquidations are often touted as being particularly superior to Chapter 7 liquidations in the flexibility that they provide for the investment of funds. The United States Trustee provides extremely restrictive and cautious requirements for depositing and handling of cash by a Chapter 7 trustee. Most creditors of bankrupt estates are willing to accept significantly greater risk in the management of the estate’s funds in exchange for the higher expected returns. The liquidator may hold a substantial amount of funds for fairly long periods of time between distributions. Accordingly, the liquidator needs to obtain the highest “safe” interest rate available. Also, the liquidator should be required to invest money with an eye toward its availability to pay costs and make distributions. Investments involving substantial, early withdrawal penalties should only be undertaken, if other funds are clearly sufficient for anticipated cash needs.

Administration of Claims

The liquidator has the principal responsibility of processing and, where appropriate, objecting to claims filed by creditors. The liquidating plan of reorganization should be structured to encourage prompt resolution of claim disputes. Eliminating improper claims improves the payout to those creditors who are entitled to payment, and resolution of a claim objection helps speed payment to all creditors. Maintaining substantial reserves against frivolous and disputed claims for a long period of time can be frustrating to creditors and may create other problems.

Seek Legal Help

An experienced Riverton Utah bankruptcy lawyer can represent creditors in a Chapter 11 bankruptcy, Chapter 7, or Chapter 13. The bankruptcy attorney will ensure that the liquidator discharges his responsibilities and acts in a fair manner.

Riverton Utah Bankruptcy Lawyer Free Consultation

When you need bankruptcy legal help, please call Ascent Law for your free consultation at (801) 676-5506. We want to help you.

Ascent Law LLC 8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506

Ascent Law LLC

4.9 stars – based on 67 reviews

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from Michael Anderson https://www.ascentlawfirm.com/bankruptcy-lawyer-riverton-utah/

from Criminal Defense Lawyer West Jordan Utah https://criminaldefenselawyerwestjordanutah.wordpress.com/2019/08/09/bankruptcy-lawyer-riverton-utah/

Bankruptcy Lawyer Riverton Utah

When you need help to file bankruptcy, or someone has filed bankruptcy on you, call Ascent Law for your free consultation. We have bankruptcy attorneys on staff who are very familiar with the court process and can help you. Creditors in a Chapter 11 bankruptcy can play a vital role in supervising the role of the liquidator. In a Chapter 7 or 13 case, not so much. If you are a creditor in a Chapter 11 bankruptcy, hire the services of an experienced Riverton Utah bankruptcy lawyer to represent you.

How best to supervise the liquidator depends on the facts of the Chapter 11 case. A smaller case is likely to require less sophisticated supervision than a large one. A case in which the liquidation process is complex and multifaceted requires more supervision than one involving a small number of assets or just one or two items of litigation. If the debtor conducts a business preconfirmation, which is consistent with post-confirmation liquidation (e.g., sales of land in a discreet development), less supervision is required than if liquidation were not within the debtor’s ordinary business activities.

Protection of the Liquidator

An experienced Riverton Utah bankruptcy lawyer will ensure that the liquidator discharges his responsibilities in a fair manner and as required by Utah bankruptcy law. One of the liquidator’s first responsibilities is to ensure that the liquidation process and the representatives of creditors who conduct it are protected from unwarranted lawsuits. This requires a balancing of goals. On the one hand, lawsuit insulation is needed to provide assurance to the liquidator and the creditors that actions taken in good faith and furtherance of the liquidation process will not result in personal liability. On the other hand, creditors must, of course, have some recourse against a dishonest or incompetent liquidator. Finally, in certain situations protecting the estate and its representative from parties outside the liquidation process is more important than protecting parties within the process from each other.

The first problem area is the potential for litigation involving the liquidator’s conduct of the business, either pending or during the liquidation. The plaintiff may be either outside or within the process. A liquidator operating a business after confirmation of a plan of reorganization is susceptible to suit if he or she commits a tortuous or contractual wrong in connection with the operation of that business. A liquidator might also be attacked for his or her wrongful conduct of the business by one of the beneficiaries of the trust.

The liquidator might also inherit problems from the Chapter 11 case itself. For example, the liquidator may be responsible for holding assets with environmental problems. If the liquidator fails to handle these matters properly, he or she could be held personally liable for violations of environmental laws. Similarly, the liquidator who is not the Chapter 11 Trustee may be held liable for a failure to pay taxes or other governmental claims.

The plan of reorganization and other enabling documents should limit the liquidator’s liability to wrongful conduct that is willful, reckless, or grossly negligent. This type of provision is customary and the only practical protection available. The plan and other enabling documents should also provide for indemnification of the liquidator and others who may be vulnerable to suit for his or her conduct after confirmation of the plan.

Directors’ and officers’ (D&O) liability insurance may be available to the liquidator and the group governing the liquidator’s conduct. Ordinarily, D&O liability insurance is expensive to obtain for a debtor who is fresh out of Chapter 11 and undergoing liquidation.

To the extent that money or property come into the liquidator’s possession, he or she should be bonded. While these bonds are expensive, a creditors’ committee that fails to require a bond for a liquidator may find itself subject to criticism (and perhaps a lawsuit), if that liquidator breaches his or her trust.

Liquidator’s Attorney-Client Privilege

The liquidator has the ability to assert or waive the attorney-client privilege on behalf of the debtor. Problems arise when one or more members of a creditors’ committee does not fully understand the importance keeping matters discussed within the committee confidential. In the early stages of the liquidation, a liquidator and supervisory creditor group should determine what information will be disseminated to committee members and when it will be disseminated. The committee may want to restrict certain areas of confidential information to a subcommittee. Other than that, little can be done except to impress upon committee members the importance of maintaining the confidentiality of discussions within the committee.

Avoiding the Appearance of Impropriety

Liquidators must strive to avoid the appearance of impropriety. Typically, the liquidator is overseen by a group of creditor representatives. Usually, the largest creditors are on the supervising creditors’ committee. Frequently, one of these creditors has a substantial issue regarding the validity or enforceability of part or all of its claim. This individual creditor may well have both the ability and desire to intimidate the liquidator in order to discourage an objection or to receive other favorable treatment for its claim. A liquidator in this situation clearly has a problem. Certainly, the governing documents need to be drafted in such a way that the liquidator will not be discouraged from objecting to any particular claim, especially the claim of a creditor sitting in oversight. This issue can be dealt with in one of several ways. If necessary, court intervention can be requested. A less expensive solution is to require a substantial plurality of the oversight committee members to object to compensation. In the event that plurality is achieved, the governing documents can also require that court advice be sought. A practical and efficient way for the liquidator to handle this situation is to be very open and thorough in communicating with the members of the committee. Communication is the key here. All of the objections to the large claims should be communicated to the full committee in order to head off this issue in advance. The liquidator should communicate equally and completely with each one of the members of the governing body of creditors. This approach should help avoid a confrontation with one of the substantial creditors sitting in judgment of the liquidating trustee’s fees.

Funding the Liquidating Trust

The liquidator and the creditors frequently discuss how much money to hold and how long to hold it. Taxes can be an important issue. The first amount is set aside, after consulting with the trustee’s tax advisors, to cover any potentially conceivable tax liabilities until the liquidator is ready to close the estate and all the returns due to be filed have been blessed by the IRS. A delay of several years in closing the estate is not unusual for this reason. The liquidator must also hold back enough to cover all professional and trustee’s fees and maintain reserves sufficient to cover other liabilities that might be assessed against the liquidator. While maintaining this reserve may temporarily diminish the return to creditors, this approach is preferable to the liquidator facing large, personal liability for distributing money to the wrong recipients. In a liquidating trust established for the sole purpose of pursuing litigation, the trust must be funded at its inception with seed money. This amount is set aside at confirmation out of cash in the estate funds and used to fund the ongoing litigation. The fund may thereafter be increased with litigation proceeds as cases are settled or otherwise resolved. The liquidator often negotiates with his or her professionals for contingency fee arrangements or fee caps in order to avoid running out of money prior to the conclusion of litigation.

Compensation of the Liquidator under a Liquidating Plan

Compensation of the liquidator is negotiated in each case. The liquidator is typically identified in advance of plan confirmation. Compensation is addressed in the plan and disclosed in connection with solicitation of acceptances. If the name of the liquidator is not known until after confirmation, the plan should make provision for the negotiation of a compensation arrangement. In this instance, the plan should be flexible so that the committee or other entity empowered to oversee the liquidator can strike the best possible bargain.

The liquidator is commonly compensated on the basis of an hourly rate, an annual fee, a percentage of recovery, or some contingency or progress standard. Which of these ways of compensating a liquidator is best varies from case to case. In general, the larger estates tend to compensate the liquidator on more of an hourly rate, and the smaller estates tend to compensate the liquidator on a success-based formula. Typically, compensation plans provide for a minimum hourly rate. With all but the very largest billion-dollar estates, an incentive, or “kicker,” is used to motivate the liquidator to maximize the assets available for distribution. The incentive may be based on a percentage of the amount of money distributed in the estate or on the percentage of recoveries of the creditors under the plan. Obviously, the facts of each particular case control the weightings of compensation between hourly and contingency formulas. A prospective liquidator may decline the appointment if the method of compensation is not satisfactory. Flexibility on this particular issue is important. Without flexibility, persons who would otherwise be well suited to perform the role of liquidator may be unobtainable, resulting ultimately in detriment to the estate. The most effective liquidation is not necessarily the cheapest.

Compensation of the liquidator should be subject to some controls. Chapter 7 and Chapter 11 trustees are clearly subject to court control of compensation. The compensation of any other type of liquidator is subject to court scrutiny only when provided in the plan. The liquidating plan of reorganization should include a mechanism for review of the liquidator’s compensation under certain circumstances. Usually that mechanism relies only on the participation of the creditors’ committee or other oversight body. Court supervision is not usually required.

Duties of the Liquidator under a Liquidating Plan

The liquidating plan of reorganization should clearly define the liquidator’s functions. These functions are similar to those duties of a

Chapter 7 Trustee

While the functions may vary from case to case, the liquidator is expected to perform six general categories of duties: (i) protection of assets, (ii) operation of assets (to the extent appropriate), (iii) liquidation of assets, (iv) investment of funds, (v) administration of claims, and (vi) reporting to stakeholders. But much more flexibility is provided to the liquidator for performing these duties under a post-confirmation liquidation.

Protection of Assets

The goal is to maximize the present value of the cash proceeds of the estate which will ultimately be available for distribution to creditors. The liquidator must take whatever steps are necessary to protect assets of the estate. As in Chapter 7, the first task of a liquidator is to review the property of the estate and determine what steps need to be taken regarding maintenance, protection, and insurance. To the extent that such issues can be foreseen, the plan should provide the liquidator with general guidance in this area, as well as establish a procedure for making extraordinary decisions, such as the discontinuation of security or insurance.

Operation of Assets

Second, the liquidator may need to operate assets of the estate. Operations should not occur at a loss except under the most peculiar circumstances. One such circumstance arises when the operation of an asset preserves a “going concern” value that greatly exceeds the liquidation value. Another is when large noncash charges cause the operation to show losses for accounting purposes but nonetheless to generate positive cash flow. On the other hand, to the extent that the cost of maintaining assets may be offset by their operation, the liquidator has a clear duty to undertake that operation. The liquidator should have some leeway in overseeing operational assets that are part of the estate.

Liquidation of Assets

While the liquidator should have the authority to operate businesses owned by the estate, his or her true role is to liquidate those businesses sooner or later for the benefit of the estate. The liquidator should have the clear obligation to take appropriate steps to liquidate the estate. The mechanics of liquidation should be clearly set out in the plan. Liquidation by the liquidator without involvement of the bankruptcy court is often preferable. Nonetheless, some buyers, especially in connection with large asset dispositions, want an order from the bankruptcy court (“comfort orders”) approving the sale.

Investment of Funds

The liquidator has the duty to invest the estate’s funds. As a fundamental matter, the plan should provide that the liquidator invest the funds safely. Post-confirmation liquidations are often touted as being particularly superior to Chapter 7 liquidations in the flexibility that they provide for the investment of funds. The United States Trustee provides extremely restrictive and cautious requirements for depositing and handling of cash by a Chapter 7 trustee. Most creditors of bankrupt estates are willing to accept significantly greater risk in the management of the estate’s funds in exchange for the higher expected returns. The liquidator may hold a substantial amount of funds for fairly long periods of time between distributions. Accordingly, the liquidator needs to obtain the highest “safe” interest rate available. Also, the liquidator should be required to invest money with an eye toward its availability to pay costs and make distributions. Investments involving substantial, early withdrawal penalties should only be undertaken, if other funds are clearly sufficient for anticipated cash needs.

Administration of Claims

The liquidator has the principal responsibility of processing and, where appropriate, objecting to claims filed by creditors. The liquidating plan of reorganization should be structured to encourage prompt resolution of claim disputes. Eliminating improper claims improves the payout to those creditors who are entitled to payment, and resolution of a claim objection helps speed payment to all creditors. Maintaining substantial reserves against frivolous and disputed claims for a long period of time can be frustrating to creditors and may create other problems.

Seek Legal Help

An experienced Riverton Utah bankruptcy lawyer can represent creditors in a Chapter 11 bankruptcy, Chapter 7, or Chapter 13. The bankruptcy attorney will ensure that the liquidator discharges his responsibilities and acts in a fair manner.

Riverton Utah Bankruptcy Lawyer Free Consultation

When you need bankruptcy legal help, please call Ascent Law for your free consultation at (801) 676-5506. We want to help you.

Ascent Law LLC 8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506

Ascent Law LLC

4.9 stars – based on 67 reviews

Recent Posts

Is It Illegal To Withdraw Money From A Deceased Persons Account?

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Source: https://www.ascentlawfirm.com/bankruptcy-lawyer-riverton-utah/

Bankruptcy Lawyer Riverton Utah

When you need help to file bankruptcy, or someone has filed bankruptcy on you, call Ascent Law for your free consultation. We have bankruptcy attorneys on staff who are very familiar with the court process and can help you. Creditors in a Chapter 11 bankruptcy can play a vital role in supervising the role of the liquidator. In a Chapter 7 or 13 case, not so much. If you are a creditor in a Chapter 11 bankruptcy, hire the services of an experienced Riverton Utah bankruptcy lawyer to represent you.

How best to supervise the liquidator depends on the facts of the Chapter 11 case. A smaller case is likely to require less sophisticated supervision than a large one. A case in which the liquidation process is complex and multifaceted requires more supervision than one involving a small number of assets or just one or two items of litigation. If the debtor conducts a business preconfirmation, which is consistent with post-confirmation liquidation (e.g., sales of land in a discreet development), less supervision is required than if liquidation were not within the debtor’s ordinary business activities.

Protection of the Liquidator

An experienced Riverton Utah bankruptcy lawyer will ensure that the liquidator discharges his responsibilities in a fair manner and as required by Utah bankruptcy law. One of the liquidator’s first responsibilities is to ensure that the liquidation process and the representatives of creditors who conduct it are protected from unwarranted lawsuits. This requires a balancing of goals. On the one hand, lawsuit insulation is needed to provide assurance to the liquidator and the creditors that actions taken in good faith and furtherance of the liquidation process will not result in personal liability. On the other hand, creditors must, of course, have some recourse against a dishonest or incompetent liquidator. Finally, in certain situations protecting the estate and its representative from parties outside the liquidation process is more important than protecting parties within the process from each other.

The first problem area is the potential for litigation involving the liquidator’s conduct of the business, either pending or during the liquidation. The plaintiff may be either outside or within the process. A liquidator operating a business after confirmation of a plan of reorganization is susceptible to suit if he or she commits a tortuous or contractual wrong in connection with the operation of that business. A liquidator might also be attacked for his or her wrongful conduct of the business by one of the beneficiaries of the trust.

The liquidator might also inherit problems from the Chapter 11 case itself. For example, the liquidator may be responsible for holding assets with environmental problems. If the liquidator fails to handle these matters properly, he or she could be held personally liable for violations of environmental laws. Similarly, the liquidator who is not the Chapter 11 Trustee may be held liable for a failure to pay taxes or other governmental claims.

The plan of reorganization and other enabling documents should limit the liquidator’s liability to wrongful conduct that is willful, reckless, or grossly negligent. This type of provision is customary and the only practical protection available. The plan and other enabling documents should also provide for indemnification of the liquidator and others who may be vulnerable to suit for his or her conduct after confirmation of the plan.

Directors’ and officers’ (D&O) liability insurance may be available to the liquidator and the group governing the liquidator’s conduct. Ordinarily, D&O liability insurance is expensive to obtain for a debtor who is fresh out of Chapter 11 and undergoing liquidation.

To the extent that money or property come into the liquidator’s possession, he or she should be bonded. While these bonds are expensive, a creditors’ committee that fails to require a bond for a liquidator may find itself subject to criticism (and perhaps a lawsuit), if that liquidator breaches his or her trust.

Liquidator’s Attorney-Client Privilege

The liquidator has the ability to assert or waive the attorney-client privilege on behalf of the debtor. Problems arise when one or more members of a creditors’ committee does not fully understand the importance keeping matters discussed within the committee confidential. In the early stages of the liquidation, a liquidator and supervisory creditor group should determine what information will be disseminated to committee members and when it will be disseminated. The committee may want to restrict certain areas of confidential information to a subcommittee. Other than that, little can be done except to impress upon committee members the importance of maintaining the confidentiality of discussions within the committee.

Avoiding the Appearance of Impropriety

Liquidators must strive to avoid the appearance of impropriety. Typically, the liquidator is overseen by a group of creditor representatives. Usually, the largest creditors are on the supervising creditors’ committee. Frequently, one of these creditors has a substantial issue regarding the validity or enforceability of part or all of its claim. This individual creditor may well have both the ability and desire to intimidate the liquidator in order to discourage an objection or to receive other favorable treatment for its claim. A liquidator in this situation clearly has a problem. Certainly, the governing documents need to be drafted in such a way that the liquidator will not be discouraged from objecting to any particular claim, especially the claim of a creditor sitting in oversight. This issue can be dealt with in one of several ways. If necessary, court intervention can be requested. A less expensive solution is to require a substantial plurality of the oversight committee members to object to compensation. In the event that plurality is achieved, the governing documents can also require that court advice be sought. A practical and efficient way for the liquidator to handle this situation is to be very open and thorough in communicating with the members of the committee. Communication is the key here. All of the objections to the large claims should be communicated to the full committee in order to head off this issue in advance. The liquidator should communicate equally and completely with each one of the members of the governing body of creditors. This approach should help avoid a confrontation with one of the substantial creditors sitting in judgment of the liquidating trustee’s fees.

Funding the Liquidating Trust

The liquidator and the creditors frequently discuss how much money to hold and how long to hold it. Taxes can be an important issue. The first amount is set aside, after consulting with the trustee’s tax advisors, to cover any potentially conceivable tax liabilities until the liquidator is ready to close the estate and all the returns due to be filed have been blessed by the IRS. A delay of several years in closing the estate is not unusual for this reason. The liquidator must also hold back enough to cover all professional and trustee’s fees and maintain reserves sufficient to cover other liabilities that might be assessed against the liquidator. While maintaining this reserve may temporarily diminish the return to creditors, this approach is preferable to the liquidator facing large, personal liability for distributing money to the wrong recipients. In a liquidating trust established for the sole purpose of pursuing litigation, the trust must be funded at its inception with seed money. This amount is set aside at confirmation out of cash in the estate funds and used to fund the ongoing litigation. The fund may thereafter be increased with litigation proceeds as cases are settled or otherwise resolved. The liquidator often negotiates with his or her professionals for contingency fee arrangements or fee caps in order to avoid running out of money prior to the conclusion of litigation.

Compensation of the Liquidator under a Liquidating Plan

Compensation of the liquidator is negotiated in each case. The liquidator is typically identified in advance of plan confirmation. Compensation is addressed in the plan and disclosed in connection with solicitation of acceptances. If the name of the liquidator is not known until after confirmation, the plan should make provision for the negotiation of a compensation arrangement. In this instance, the plan should be flexible so that the committee or other entity empowered to oversee the liquidator can strike the best possible bargain.

The liquidator is commonly compensated on the basis of an hourly rate, an annual fee, a percentage of recovery, or some contingency or progress standard. Which of these ways of compensating a liquidator is best varies from case to case. In general, the larger estates tend to compensate the liquidator on more of an hourly rate, and the smaller estates tend to compensate the liquidator on a success-based formula. Typically, compensation plans provide for a minimum hourly rate. With all but the very largest billion-dollar estates, an incentive, or “kicker,” is used to motivate the liquidator to maximize the assets available for distribution. The incentive may be based on a percentage of the amount of money distributed in the estate or on the percentage of recoveries of the creditors under the plan. Obviously, the facts of each particular case control the weightings of compensation between hourly and contingency formulas. A prospective liquidator may decline the appointment if the method of compensation is not satisfactory. Flexibility on this particular issue is important. Without flexibility, persons who would otherwise be well suited to perform the role of liquidator may be unobtainable, resulting ultimately in detriment to the estate. The most effective liquidation is not necessarily the cheapest.

Compensation of the liquidator should be subject to some controls. Chapter 7 and Chapter 11 trustees are clearly subject to court control of compensation. The compensation of any other type of liquidator is subject to court scrutiny only when provided in the plan. The liquidating plan of reorganization should include a mechanism for review of the liquidator’s compensation under certain circumstances. Usually that mechanism relies only on the participation of the creditors’ committee or other oversight body. Court supervision is not usually required.

Duties of the Liquidator under a Liquidating Plan

The liquidating plan of reorganization should clearly define the liquidator’s functions. These functions are similar to those duties of a

Chapter 7 Trustee

While the functions may vary from case to case, the liquidator is expected to perform six general categories of duties: (i) protection of assets, (ii) operation of assets (to the extent appropriate), (iii) liquidation of assets, (iv) investment of funds, (v) administration of claims, and (vi) reporting to stakeholders. But much more flexibility is provided to the liquidator for performing these duties under a post-confirmation liquidation.

Protection of Assets

The goal is to maximize the present value of the cash proceeds of the estate which will ultimately be available for distribution to creditors. The liquidator must take whatever steps are necessary to protect assets of the estate. As in Chapter 7, the first task of a liquidator is to review the property of the estate and determine what steps need to be taken regarding maintenance, protection, and insurance. To the extent that such issues can be foreseen, the plan should provide the liquidator with general guidance in this area, as well as establish a procedure for making extraordinary decisions, such as the discontinuation of security or insurance.

Operation of Assets

Second, the liquidator may need to operate assets of the estate. Operations should not occur at a loss except under the most peculiar circumstances. One such circumstance arises when the operation of an asset preserves a “going concern” value that greatly exceeds the liquidation value. Another is when large noncash charges cause the operation to show losses for accounting purposes but nonetheless to generate positive cash flow. On the other hand, to the extent that the cost of maintaining assets may be offset by their operation, the liquidator has a clear duty to undertake that operation. The liquidator should have some leeway in overseeing operational assets that are part of the estate.

Liquidation of Assets

While the liquidator should have the authority to operate businesses owned by the estate, his or her true role is to liquidate those businesses sooner or later for the benefit of the estate. The liquidator should have the clear obligation to take appropriate steps to liquidate the estate. The mechanics of liquidation should be clearly set out in the plan. Liquidation by the liquidator without involvement of the bankruptcy court is often preferable. Nonetheless, some buyers, especially in connection with large asset dispositions, want an order from the bankruptcy court (“comfort orders”) approving the sale.

Investment of Funds

The liquidator has the duty to invest the estate’s funds. As a fundamental matter, the plan should provide that the liquidator invest the funds safely. Post-confirmation liquidations are often touted as being particularly superior to Chapter 7 liquidations in the flexibility that they provide for the investment of funds. The United States Trustee provides extremely restrictive and cautious requirements for depositing and handling of cash by a Chapter 7 trustee. Most creditors of bankrupt estates are willing to accept significantly greater risk in the management of the estate’s funds in exchange for the higher expected returns. The liquidator may hold a substantial amount of funds for fairly long periods of time between distributions. Accordingly, the liquidator needs to obtain the highest “safe” interest rate available. Also, the liquidator should be required to invest money with an eye toward its availability to pay costs and make distributions. Investments involving substantial, early withdrawal penalties should only be undertaken, if other funds are clearly sufficient for anticipated cash needs.

Administration of Claims

The liquidator has the principal responsibility of processing and, where appropriate, objecting to claims filed by creditors. The liquidating plan of reorganization should be structured to encourage prompt resolution of claim disputes. Eliminating improper claims improves the payout to those creditors who are entitled to payment, and resolution of a claim objection helps speed payment to all creditors. Maintaining substantial reserves against frivolous and disputed claims for a long period of time can be frustrating to creditors and may create other problems.

Seek Legal Help

An experienced Riverton Utah bankruptcy lawyer can represent creditors in a Chapter 11 bankruptcy, Chapter 7, or Chapter 13. The bankruptcy attorney will ensure that the liquidator discharges his responsibilities and acts in a fair manner.

Riverton Utah Bankruptcy Lawyer Free Consultation

When you need bankruptcy legal help, please call Ascent Law for your free consultation at (801) 676-5506. We want to help you.

Ascent Law LLC 8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506

Ascent Law LLC

4.9 stars – based on 67 reviews

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from Michael Anderson https://www.ascentlawfirm.com/bankruptcy-lawyer-riverton-utah/

Bankruptcy Lawyer Riverton Utah

When you need help to file bankruptcy, or someone has filed bankruptcy on you, call Ascent Law for your free consultation. We have bankruptcy attorneys on staff who are very familiar with the court process and can help you. Creditors in a Chapter 11 bankruptcy can play a vital role in supervising the role of the liquidator. In a Chapter 7 or 13 case, not so much. If you are a creditor in a Chapter 11 bankruptcy, hire the services of an experienced Riverton Utah bankruptcy lawyer to represent you.

How best to supervise the liquidator depends on the facts of the Chapter 11 case. A smaller case is likely to require less sophisticated supervision than a large one. A case in which the liquidation process is complex and multifaceted requires more supervision than one involving a small number of assets or just one or two items of litigation. If the debtor conducts a business preconfirmation, which is consistent with post-confirmation liquidation (e.g., sales of land in a discreet development), less supervision is required than if liquidation were not within the debtor’s ordinary business activities.

Protection of the Liquidator

An experienced Riverton Utah bankruptcy lawyer will ensure that the liquidator discharges his responsibilities in a fair manner and as required by Utah bankruptcy law. One of the liquidator’s first responsibilities is to ensure that the liquidation process and the representatives of creditors who conduct it are protected from unwarranted lawsuits. This requires a balancing of goals. On the one hand, lawsuit insulation is needed to provide assurance to the liquidator and the creditors that actions taken in good faith and furtherance of the liquidation process will not result in personal liability. On the other hand, creditors must, of course, have some recourse against a dishonest or incompetent liquidator. Finally, in certain situations protecting the estate and its representative from parties outside the liquidation process is more important than protecting parties within the process from each other.

The first problem area is the potential for litigation involving the liquidator’s conduct of the business, either pending or during the liquidation. The plaintiff may be either outside or within the process. A liquidator operating a business after confirmation of a plan of reorganization is susceptible to suit if he or she commits a tortuous or contractual wrong in connection with the operation of that business. A liquidator might also be attacked for his or her wrongful conduct of the business by one of the beneficiaries of the trust.

The liquidator might also inherit problems from the Chapter 11 case itself. For example, the liquidator may be responsible for holding assets with environmental problems. If the liquidator fails to handle these matters properly, he or she could be held personally liable for violations of environmental laws. Similarly, the liquidator who is not the Chapter 11 Trustee may be held liable for a failure to pay taxes or other governmental claims.

The plan of reorganization and other enabling documents should limit the liquidator’s liability to wrongful conduct that is willful, reckless, or grossly negligent. This type of provision is customary and the only practical protection available. The plan and other enabling documents should also provide for indemnification of the liquidator and others who may be vulnerable to suit for his or her conduct after confirmation of the plan.

Directors’ and officers’ (D&O) liability insurance may be available to the liquidator and the group governing the liquidator’s conduct. Ordinarily, D&O liability insurance is expensive to obtain for a debtor who is fresh out of Chapter 11 and undergoing liquidation.

To the extent that money or property come into the liquidator’s possession, he or she should be bonded. While these bonds are expensive, a creditors’ committee that fails to require a bond for a liquidator may find itself subject to criticism (and perhaps a lawsuit), if that liquidator breaches his or her trust.

Liquidator’s Attorney-Client Privilege

The liquidator has the ability to assert or waive the attorney-client privilege on behalf of the debtor. Problems arise when one or more members of a creditors’ committee does not fully understand the importance keeping matters discussed within the committee confidential. In the early stages of the liquidation, a liquidator and supervisory creditor group should determine what information will be disseminated to committee members and when it will be disseminated. The committee may want to restrict certain areas of confidential information to a subcommittee. Other than that, little can be done except to impress upon committee members the importance of maintaining the confidentiality of discussions within the committee.

Avoiding the Appearance of Impropriety

Liquidators must strive to avoid the appearance of impropriety. Typically, the liquidator is overseen by a group of creditor representatives. Usually, the largest creditors are on the supervising creditors’ committee. Frequently, one of these creditors has a substantial issue regarding the validity or enforceability of part or all of its claim. This individual creditor may well have both the ability and desire to intimidate the liquidator in order to discourage an objection or to receive other favorable treatment for its claim. A liquidator in this situation clearly has a problem. Certainly, the governing documents need to be drafted in such a way that the liquidator will not be discouraged from objecting to any particular claim, especially the claim of a creditor sitting in oversight. This issue can be dealt with in one of several ways. If necessary, court intervention can be requested. A less expensive solution is to require a substantial plurality of the oversight committee members to object to compensation. In the event that plurality is achieved, the governing documents can also require that court advice be sought. A practical and efficient way for the liquidator to handle this situation is to be very open and thorough in communicating with the members of the committee. Communication is the key here. All of the objections to the large claims should be communicated to the full committee in order to head off this issue in advance. The liquidator should communicate equally and completely with each one of the members of the governing body of creditors. This approach should help avoid a confrontation with one of the substantial creditors sitting in judgment of the liquidating trustee’s fees.

Funding the Liquidating Trust

The liquidator and the creditors frequently discuss how much money to hold and how long to hold it. Taxes can be an important issue. The first amount is set aside, after consulting with the trustee’s tax advisors, to cover any potentially conceivable tax liabilities until the liquidator is ready to close the estate and all the returns due to be filed have been blessed by the IRS. A delay of several years in closing the estate is not unusual for this reason. The liquidator must also hold back enough to cover all professional and trustee’s fees and maintain reserves sufficient to cover other liabilities that might be assessed against the liquidator. While maintaining this reserve may temporarily diminish the return to creditors, this approach is preferable to the liquidator facing large, personal liability for distributing money to the wrong recipients. In a liquidating trust established for the sole purpose of pursuing litigation, the trust must be funded at its inception with seed money. This amount is set aside at confirmation out of cash in the estate funds and used to fund the ongoing litigation. The fund may thereafter be increased with litigation proceeds as cases are settled or otherwise resolved. The liquidator often negotiates with his or her professionals for contingency fee arrangements or fee caps in order to avoid running out of money prior to the conclusion of litigation.

Compensation of the Liquidator under a Liquidating Plan

Compensation of the liquidator is negotiated in each case. The liquidator is typically identified in advance of plan confirmation. Compensation is addressed in the plan and disclosed in connection with solicitation of acceptances. If the name of the liquidator is not known until after confirmation, the plan should make provision for the negotiation of a compensation arrangement. In this instance, the plan should be flexible so that the committee or other entity empowered to oversee the liquidator can strike the best possible bargain.

The liquidator is commonly compensated on the basis of an hourly rate, an annual fee, a percentage of recovery, or some contingency or progress standard. Which of these ways of compensating a liquidator is best varies from case to case. In general, the larger estates tend to compensate the liquidator on more of an hourly rate, and the smaller estates tend to compensate the liquidator on a success-based formula. Typically, compensation plans provide for a minimum hourly rate. With all but the very largest billion-dollar estates, an incentive, or “kicker,” is used to motivate the liquidator to maximize the assets available for distribution. The incentive may be based on a percentage of the amount of money distributed in the estate or on the percentage of recoveries of the creditors under the plan. Obviously, the facts of each particular case control the weightings of compensation between hourly and contingency formulas. A prospective liquidator may decline the appointment if the method of compensation is not satisfactory. Flexibility on this particular issue is important. Without flexibility, persons who would otherwise be well suited to perform the role of liquidator may be unobtainable, resulting ultimately in detriment to the estate. The most effective liquidation is not necessarily the cheapest.

Compensation of the liquidator should be subject to some controls. Chapter 7 and Chapter 11 trustees are clearly subject to court control of compensation. The compensation of any other type of liquidator is subject to court scrutiny only when provided in the plan. The liquidating plan of reorganization should include a mechanism for review of the liquidator’s compensation under certain circumstances. Usually that mechanism relies only on the participation of the creditors’ committee or other oversight body. Court supervision is not usually required.

Duties of the Liquidator under a Liquidating Plan

The liquidating plan of reorganization should clearly define the liquidator’s functions. These functions are similar to those duties of a

Chapter 7 Trustee

While the functions may vary from case to case, the liquidator is expected to perform six general categories of duties: (i) protection of assets, (ii) operation of assets (to the extent appropriate), (iii) liquidation of assets, (iv) investment of funds, (v) administration of claims, and (vi) reporting to stakeholders. But much more flexibility is provided to the liquidator for performing these duties under a post-confirmation liquidation.

Protection of Assets

The goal is to maximize the present value of the cash proceeds of the estate which will ultimately be available for distribution to creditors. The liquidator must take whatever steps are necessary to protect assets of the estate. As in Chapter 7, the first task of a liquidator is to review the property of the estate and determine what steps need to be taken regarding maintenance, protection, and insurance. To the extent that such issues can be foreseen, the plan should provide the liquidator with general guidance in this area, as well as establish a procedure for making extraordinary decisions, such as the discontinuation of security or insurance.

Operation of Assets

Second, the liquidator may need to operate assets of the estate. Operations should not occur at a loss except under the most peculiar circumstances. One such circumstance arises when the operation of an asset preserves a “going concern” value that greatly exceeds the liquidation value. Another is when large noncash charges cause the operation to show losses for accounting purposes but nonetheless to generate positive cash flow. On the other hand, to the extent that the cost of maintaining assets may be offset by their operation, the liquidator has a clear duty to undertake that operation. The liquidator should have some leeway in overseeing operational assets that are part of the estate.

Liquidation of Assets

While the liquidator should have the authority to operate businesses owned by the estate, his or her true role is to liquidate those businesses sooner or later for the benefit of the estate. The liquidator should have the clear obligation to take appropriate steps to liquidate the estate. The mechanics of liquidation should be clearly set out in the plan. Liquidation by the liquidator without involvement of the bankruptcy court is often preferable. Nonetheless, some buyers, especially in connection with large asset dispositions, want an order from the bankruptcy court (“comfort orders”) approving the sale.

Investment of Funds

The liquidator has the duty to invest the estate’s funds. As a fundamental matter, the plan should provide that the liquidator invest the funds safely. Post-confirmation liquidations are often touted as being particularly superior to Chapter 7 liquidations in the flexibility that they provide for the investment of funds. The United States Trustee provides extremely restrictive and cautious requirements for depositing and handling of cash by a Chapter 7 trustee. Most creditors of bankrupt estates are willing to accept significantly greater risk in the management of the estate’s funds in exchange for the higher expected returns. The liquidator may hold a substantial amount of funds for fairly long periods of time between distributions. Accordingly, the liquidator needs to obtain the highest “safe” interest rate available. Also, the liquidator should be required to invest money with an eye toward its availability to pay costs and make distributions. Investments involving substantial, early withdrawal penalties should only be undertaken, if other funds are clearly sufficient for anticipated cash needs.

Administration of Claims

The liquidator has the principal responsibility of processing and, where appropriate, objecting to claims filed by creditors. The liquidating plan of reorganization should be structured to encourage prompt resolution of claim disputes. Eliminating improper claims improves the payout to those creditors who are entitled to payment, and resolution of a claim objection helps speed payment to all creditors. Maintaining substantial reserves against frivolous and disputed claims for a long period of time can be frustrating to creditors and may create other problems.

Seek Legal Help

An experienced Riverton Utah bankruptcy lawyer can represent creditors in a Chapter 11 bankruptcy, Chapter 7, or Chapter 13. The bankruptcy attorney will ensure that the liquidator discharges his responsibilities and acts in a fair manner.

Riverton Utah Bankruptcy Lawyer Free Consultation

When you need bankruptcy legal help, please call Ascent Law for your free consultation at (801) 676-5506. We want to help you.

Ascent Law LLC 8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506

Ascent Law LLC

4.9 stars – based on 67 reviews

Recent Posts

Is It Illegal To Withdraw Money From A Deceased Persons Account?

Corporate Lawyer Grantsville Utah

What Is The Fastest Way To Get Out of Debt?

FLP vs LLC

How To Get Custody Of Your Child In Utah

Are Divorce Rates Increasing?

from https://www.ascentlawfirm.com/bankruptcy-lawyer-riverton-utah/

from Criminal Defense Lawyer West Jordan Utah - Blog http://criminaldefenselawyerwestjordanutah.weebly.com/blog/bankruptcy-lawyer-riverton-utah

Bankruptcy Lawyer Riverton Utah

When you need help to file bankruptcy, or someone has filed bankruptcy on you, call Ascent Law for your free consultation. We have bankruptcy attorneys on staff who are very familiar with the court process and can help you. Creditors in a Chapter 11 bankruptcy can play a vital role in supervising the role of the liquidator. In a Chapter 7 or 13 case, not so much. If you are a creditor in a Chapter 11 bankruptcy, hire the services of an experienced Riverton Utah bankruptcy lawyer to represent you.

How best to supervise the liquidator depends on the facts of the Chapter 11 case. A smaller case is likely to require less sophisticated supervision than a large one. A case in which the liquidation process is complex and multifaceted requires more supervision than one involving a small number of assets or just one or two items of litigation. If the debtor conducts a business preconfirmation, which is consistent with post-confirmation liquidation (e.g., sales of land in a discreet development), less supervision is required than if liquidation were not within the debtor’s ordinary business activities.

Protection of the Liquidator

An experienced Riverton Utah bankruptcy lawyer will ensure that the liquidator discharges his responsibilities in a fair manner and as required by Utah bankruptcy law. One of the liquidator’s first responsibilities is to ensure that the liquidation process and the representatives of creditors who conduct it are protected from unwarranted lawsuits. This requires a balancing of goals. On the one hand, lawsuit insulation is needed to provide assurance to the liquidator and the creditors that actions taken in good faith and furtherance of the liquidation process will not result in personal liability. On the other hand, creditors must, of course, have some recourse against a dishonest or incompetent liquidator. Finally, in certain situations protecting the estate and its representative from parties outside the liquidation process is more important than protecting parties within the process from each other.

The first problem area is the potential for litigation involving the liquidator’s conduct of the business, either pending or during the liquidation. The plaintiff may be either outside or within the process. A liquidator operating a business after confirmation of a plan of reorganization is susceptible to suit if he or she commits a tortuous or contractual wrong in connection with the operation of that business. A liquidator might also be attacked for his or her wrongful conduct of the business by one of the beneficiaries of the trust.

The liquidator might also inherit problems from the Chapter 11 case itself. For example, the liquidator may be responsible for holding assets with environmental problems. If the liquidator fails to handle these matters properly, he or she could be held personally liable for violations of environmental laws. Similarly, the liquidator who is not the Chapter 11 Trustee may be held liable for a failure to pay taxes or other governmental claims.

The plan of reorganization and other enabling documents should limit the liquidator’s liability to wrongful conduct that is willful, reckless, or grossly negligent. This type of provision is customary and the only practical protection available. The plan and other enabling documents should also provide for indemnification of the liquidator and others who may be vulnerable to suit for his or her conduct after confirmation of the plan.

Directors’ and officers’ (D&O) liability insurance may be available to the liquidator and the group governing the liquidator’s conduct. Ordinarily, D&O liability insurance is expensive to obtain for a debtor who is fresh out of Chapter 11 and undergoing liquidation.

To the extent that money or property come into the liquidator’s possession, he or she should be bonded. While these bonds are expensive, a creditors’ committee that fails to require a bond for a liquidator may find itself subject to criticism (and perhaps a lawsuit), if that liquidator breaches his or her trust.

Liquidator’s Attorney-Client Privilege

The liquidator has the ability to assert or waive the attorney-client privilege on behalf of the debtor. Problems arise when one or more members of a creditors’ committee does not fully understand the importance keeping matters discussed within the committee confidential. In the early stages of the liquidation, a liquidator and supervisory creditor group should determine what information will be disseminated to committee members and when it will be disseminated. The committee may want to restrict certain areas of confidential information to a subcommittee. Other than that, little can be done except to impress upon committee members the importance of maintaining the confidentiality of discussions within the committee.

Avoiding the Appearance of Impropriety

Liquidators must strive to avoid the appearance of impropriety. Typically, the liquidator is overseen by a group of creditor representatives. Usually, the largest creditors are on the supervising creditors’ committee. Frequently, one of these creditors has a substantial issue regarding the validity or enforceability of part or all of its claim. This individual creditor may well have both the ability and desire to intimidate the liquidator in order to discourage an objection or to receive other favorable treatment for its claim. A liquidator in this situation clearly has a problem. Certainly, the governing documents need to be drafted in such a way that the liquidator will not be discouraged from objecting to any particular claim, especially the claim of a creditor sitting in oversight. This issue can be dealt with in one of several ways. If necessary, court intervention can be requested. A less expensive solution is to require a substantial plurality of the oversight committee members to object to compensation. In the event that plurality is achieved, the governing documents can also require that court advice be sought. A practical and efficient way for the liquidator to handle this situation is to be very open and thorough in communicating with the members of the committee. Communication is the key here. All of the objections to the large claims should be communicated to the full committee in order to head off this issue in advance. The liquidator should communicate equally and completely with each one of the members of the governing body of creditors. This approach should help avoid a confrontation with one of the substantial creditors sitting in judgment of the liquidating trustee’s fees.

Funding the Liquidating Trust

The liquidator and the creditors frequently discuss how much money to hold and how long to hold it. Taxes can be an important issue. The first amount is set aside, after consulting with the trustee’s tax advisors, to cover any potentially conceivable tax liabilities until the liquidator is ready to close the estate and all the returns due to be filed have been blessed by the IRS. A delay of several years in closing the estate is not unusual for this reason. The liquidator must also hold back enough to cover all professional and trustee’s fees and maintain reserves sufficient to cover other liabilities that might be assessed against the liquidator. While maintaining this reserve may temporarily diminish the return to creditors, this approach is preferable to the liquidator facing large, personal liability for distributing money to the wrong recipients. In a liquidating trust established for the sole purpose of pursuing litigation, the trust must be funded at its inception with seed money. This amount is set aside at confirmation out of cash in the estate funds and used to fund the ongoing litigation. The fund may thereafter be increased with litigation proceeds as cases are settled or otherwise resolved. The liquidator often negotiates with his or her professionals for contingency fee arrangements or fee caps in order to avoid running out of money prior to the conclusion of litigation.

Compensation of the Liquidator under a Liquidating Plan

Compensation of the liquidator is negotiated in each case. The liquidator is typically identified in advance of plan confirmation. Compensation is addressed in the plan and disclosed in connection with solicitation of acceptances. If the name of the liquidator is not known until after confirmation, the plan should make provision for the negotiation of a compensation arrangement. In this instance, the plan should be flexible so that the committee or other entity empowered to oversee the liquidator can strike the best possible bargain.

The liquidator is commonly compensated on the basis of an hourly rate, an annual fee, a percentage of recovery, or some contingency or progress standard. Which of these ways of compensating a liquidator is best varies from case to case. In general, the larger estates tend to compensate the liquidator on more of an hourly rate, and the smaller estates tend to compensate the liquidator on a success-based formula. Typically, compensation plans provide for a minimum hourly rate. With all but the very largest billion-dollar estates, an incentive, or “kicker,” is used to motivate the liquidator to maximize the assets available for distribution. The incentive may be based on a percentage of the amount of money distributed in the estate or on the percentage of recoveries of the creditors under the plan. Obviously, the facts of each particular case control the weightings of compensation between hourly and contingency formulas. A prospective liquidator may decline the appointment if the method of compensation is not satisfactory. Flexibility on this particular issue is important. Without flexibility, persons who would otherwise be well suited to perform the role of liquidator may be unobtainable, resulting ultimately in detriment to the estate. The most effective liquidation is not necessarily the cheapest.

Compensation of the liquidator should be subject to some controls. Chapter 7 and Chapter 11 trustees are clearly subject to court control of compensation. The compensation of any other type of liquidator is subject to court scrutiny only when provided in the plan. The liquidating plan of reorganization should include a mechanism for review of the liquidator’s compensation under certain circumstances. Usually that mechanism relies only on the participation of the creditors’ committee or other oversight body. Court supervision is not usually required.

Duties of the Liquidator under a Liquidating Plan

The liquidating plan of reorganization should clearly define the liquidator’s functions. These functions are similar to those duties of a

Chapter 7 Trustee

While the functions may vary from case to case, the liquidator is expected to perform six general categories of duties: (i) protection of assets, (ii) operation of assets (to the extent appropriate), (iii) liquidation of assets, (iv) investment of funds, (v) administration of claims, and (vi) reporting to stakeholders. But much more flexibility is provided to the liquidator for performing these duties under a post-confirmation liquidation.

Protection of Assets

The goal is to maximize the present value of the cash proceeds of the estate which will ultimately be available for distribution to creditors. The liquidator must take whatever steps are necessary to protect assets of the estate. As in Chapter 7, the first task of a liquidator is to review the property of the estate and determine what steps need to be taken regarding maintenance, protection, and insurance. To the extent that such issues can be foreseen, the plan should provide the liquidator with general guidance in this area, as well as establish a procedure for making extraordinary decisions, such as the discontinuation of security or insurance.

Operation of Assets

Second, the liquidator may need to operate assets of the estate. Operations should not occur at a loss except under the most peculiar circumstances. One such circumstance arises when the operation of an asset preserves a “going concern” value that greatly exceeds the liquidation value. Another is when large noncash charges cause the operation to show losses for accounting purposes but nonetheless to generate positive cash flow. On the other hand, to the extent that the cost of maintaining assets may be offset by their operation, the liquidator has a clear duty to undertake that operation. The liquidator should have some leeway in overseeing operational assets that are part of the estate.

Liquidation of Assets

While the liquidator should have the authority to operate businesses owned by the estate, his or her true role is to liquidate those businesses sooner or later for the benefit of the estate. The liquidator should have the clear obligation to take appropriate steps to liquidate the estate. The mechanics of liquidation should be clearly set out in the plan. Liquidation by the liquidator without involvement of the bankruptcy court is often preferable. Nonetheless, some buyers, especially in connection with large asset dispositions, want an order from the bankruptcy court (“comfort orders”) approving the sale.

Investment of Funds

The liquidator has the duty to invest the estate’s funds. As a fundamental matter, the plan should provide that the liquidator invest the funds safely. Post-confirmation liquidations are often touted as being particularly superior to Chapter 7 liquidations in the flexibility that they provide for the investment of funds. The United States Trustee provides extremely restrictive and cautious requirements for depositing and handling of cash by a Chapter 7 trustee. Most creditors of bankrupt estates are willing to accept significantly greater risk in the management of the estate’s funds in exchange for the higher expected returns. The liquidator may hold a substantial amount of funds for fairly long periods of time between distributions. Accordingly, the liquidator needs to obtain the highest “safe” interest rate available. Also, the liquidator should be required to invest money with an eye toward its availability to pay costs and make distributions. Investments involving substantial, early withdrawal penalties should only be undertaken, if other funds are clearly sufficient for anticipated cash needs.

Administration of Claims

The liquidator has the principal responsibility of processing and, where appropriate, objecting to claims filed by creditors. The liquidating plan of reorganization should be structured to encourage prompt resolution of claim disputes. Eliminating improper claims improves the payout to those creditors who are entitled to payment, and resolution of a claim objection helps speed payment to all creditors. Maintaining substantial reserves against frivolous and disputed claims for a long period of time can be frustrating to creditors and may create other problems.

Seek Legal Help

An experienced Riverton Utah bankruptcy lawyer can represent creditors in a Chapter 11 bankruptcy, Chapter 7, or Chapter 13. The bankruptcy attorney will ensure that the liquidator discharges his responsibilities and acts in a fair manner.

Riverton Utah Bankruptcy Lawyer Free Consultation

When you need bankruptcy legal help, please call Ascent Law for your free consultation at (801) 676-5506. We want to help you.

Ascent Law LLC 8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506

Ascent Law LLC

4.9 stars – based on 67 reviews

Recent Posts

Is It Illegal To Withdraw Money From A Deceased Persons Account?

Corporate Lawyer Grantsville Utah

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Source: https://www.ascentlawfirm.com/bankruptcy-lawyer-riverton-utah/

Bankruptcy Lawyer Riverton Utah

When you need help to file bankruptcy, or someone has filed bankruptcy on you, call Ascent Law for your free consultation. We have bankruptcy attorneys on staff who are very familiar with the court process and can help you. Creditors in a Chapter 11 bankruptcy can play a vital role in supervising the role of the liquidator. In a Chapter 7 or 13 case, not so much. If you are a creditor in a Chapter 11 bankruptcy, hire the services of an experienced Riverton Utah bankruptcy lawyer to represent you.

How best to supervise the liquidator depends on the facts of the Chapter 11 case. A smaller case is likely to require less sophisticated supervision than a large one. A case in which the liquidation process is complex and multifaceted requires more supervision than one involving a small number of assets or just one or two items of litigation. If the debtor conducts a business preconfirmation, which is consistent with post-confirmation liquidation (e.g., sales of land in a discreet development), less supervision is required than if liquidation were not within the debtor’s ordinary business activities.

Protection of the Liquidator

An experienced Riverton Utah bankruptcy lawyer will ensure that the liquidator discharges his responsibilities in a fair manner and as required by Utah bankruptcy law. One of the liquidator’s first responsibilities is to ensure that the liquidation process and the representatives of creditors who conduct it are protected from unwarranted lawsuits. This requires a balancing of goals. On the one hand, lawsuit insulation is needed to provide assurance to the liquidator and the creditors that actions taken in good faith and furtherance of the liquidation process will not result in personal liability. On the other hand, creditors must, of course, have some recourse against a dishonest or incompetent liquidator. Finally, in certain situations protecting the estate and its representative from parties outside the liquidation process is more important than protecting parties within the process from each other.

The first problem area is the potential for litigation involving the liquidator’s conduct of the business, either pending or during the liquidation. The plaintiff may be either outside or within the process. A liquidator operating a business after confirmation of a plan of reorganization is susceptible to suit if he or she commits a tortuous or contractual wrong in connection with the operation of that business. A liquidator might also be attacked for his or her wrongful conduct of the business by one of the beneficiaries of the trust.

The liquidator might also inherit problems from the Chapter 11 case itself. For example, the liquidator may be responsible for holding assets with environmental problems. If the liquidator fails to handle these matters properly, he or she could be held personally liable for violations of environmental laws. Similarly, the liquidator who is not the Chapter 11 Trustee may be held liable for a failure to pay taxes or other governmental claims.

The plan of reorganization and other enabling documents should limit the liquidator’s liability to wrongful conduct that is willful, reckless, or grossly negligent. This type of provision is customary and the only practical protection available. The plan and other enabling documents should also provide for indemnification of the liquidator and others who may be vulnerable to suit for his or her conduct after confirmation of the plan.

Directors’ and officers’ (D&O) liability insurance may be available to the liquidator and the group governing the liquidator’s conduct. Ordinarily, D&O liability insurance is expensive to obtain for a debtor who is fresh out of Chapter 11 and undergoing liquidation.

To the extent that money or property come into the liquidator’s possession, he or she should be bonded. While these bonds are expensive, a creditors’ committee that fails to require a bond for a liquidator may find itself subject to criticism (and perhaps a lawsuit), if that liquidator breaches his or her trust.

Liquidator’s Attorney-Client Privilege

The liquidator has the ability to assert or waive the attorney-client privilege on behalf of the debtor. Problems arise when one or more members of a creditors’ committee does not fully understand the importance keeping matters discussed within the committee confidential. In the early stages of the liquidation, a liquidator and supervisory creditor group should determine what information will be disseminated to committee members and when it will be disseminated. The committee may want to restrict certain areas of confidential information to a subcommittee. Other than that, little can be done except to impress upon committee members the importance of maintaining the confidentiality of discussions within the committee.

Avoiding the Appearance of Impropriety

Liquidators must strive to avoid the appearance of impropriety. Typically, the liquidator is overseen by a group of creditor representatives. Usually, the largest creditors are on the supervising creditors’ committee. Frequently, one of these creditors has a substantial issue regarding the validity or enforceability of part or all of its claim. This individual creditor may well have both the ability and desire to intimidate the liquidator in order to discourage an objection or to receive other favorable treatment for its claim. A liquidator in this situation clearly has a problem. Certainly, the governing documents need to be drafted in such a way that the liquidator will not be discouraged from objecting to any particular claim, especially the claim of a creditor sitting in oversight. This issue can be dealt with in one of several ways. If necessary, court intervention can be requested. A less expensive solution is to require a substantial plurality of the oversight committee members to object to compensation. In the event that plurality is achieved, the governing documents can also require that court advice be sought. A practical and efficient way for the liquidator to handle this situation is to be very open and thorough in communicating with the members of the committee. Communication is the key here. All of the objections to the large claims should be communicated to the full committee in order to head off this issue in advance. The liquidator should communicate equally and completely with each one of the members of the governing body of creditors. This approach should help avoid a confrontation with one of the substantial creditors sitting in judgment of the liquidating trustee’s fees.

Funding the Liquidating Trust

The liquidator and the creditors frequently discuss how much money to hold and how long to hold it. Taxes can be an important issue. The first amount is set aside, after consulting with the trustee’s tax advisors, to cover any potentially conceivable tax liabilities until the liquidator is ready to close the estate and all the returns due to be filed have been blessed by the IRS. A delay of several years in closing the estate is not unusual for this reason. The liquidator must also hold back enough to cover all professional and trustee’s fees and maintain reserves sufficient to cover other liabilities that might be assessed against the liquidator. While maintaining this reserve may temporarily diminish the return to creditors, this approach is preferable to the liquidator facing large, personal liability for distributing money to the wrong recipients. In a liquidating trust established for the sole purpose of pursuing litigation, the trust must be funded at its inception with seed money. This amount is set aside at confirmation out of cash in the estate funds and used to fund the ongoing litigation. The fund may thereafter be increased with litigation proceeds as cases are settled or otherwise resolved. The liquidator often negotiates with his or her professionals for contingency fee arrangements or fee caps in order to avoid running out of money prior to the conclusion of litigation.

Compensation of the Liquidator under a Liquidating Plan

Compensation of the liquidator is negotiated in each case. The liquidator is typically identified in advance of plan confirmation. Compensation is addressed in the plan and disclosed in connection with solicitation of acceptances. If the name of the liquidator is not known until after confirmation, the plan should make provision for the negotiation of a compensation arrangement. In this instance, the plan should be flexible so that the committee or other entity empowered to oversee the liquidator can strike the best possible bargain.

The liquidator is commonly compensated on the basis of an hourly rate, an annual fee, a percentage of recovery, or some contingency or progress standard. Which of these ways of compensating a liquidator is best varies from case to case. In general, the larger estates tend to compensate the liquidator on more of an hourly rate, and the smaller estates tend to compensate the liquidator on a success-based formula. Typically, compensation plans provide for a minimum hourly rate. With all but the very largest billion-dollar estates, an incentive, or “kicker,” is used to motivate the liquidator to maximize the assets available for distribution. The incentive may be based on a percentage of the amount of money distributed in the estate or on the percentage of recoveries of the creditors under the plan. Obviously, the facts of each particular case control the weightings of compensation between hourly and contingency formulas. A prospective liquidator may decline the appointment if the method of compensation is not satisfactory. Flexibility on this particular issue is important. Without flexibility, persons who would otherwise be well suited to perform the role of liquidator may be unobtainable, resulting ultimately in detriment to the estate. The most effective liquidation is not necessarily the cheapest.

Compensation of the liquidator should be subject to some controls. Chapter 7 and Chapter 11 trustees are clearly subject to court control of compensation. The compensation of any other type of liquidator is subject to court scrutiny only when provided in the plan. The liquidating plan of reorganization should include a mechanism for review of the liquidator’s compensation under certain circumstances. Usually that mechanism relies only on the participation of the creditors’ committee or other oversight body. Court supervision is not usually required.

Duties of the Liquidator under a Liquidating Plan

The liquidating plan of reorganization should clearly define the liquidator’s functions. These functions are similar to those duties of a

Chapter 7 Trustee

While the functions may vary from case to case, the liquidator is expected to perform six general categories of duties: (i) protection of assets, (ii) operation of assets (to the extent appropriate), (iii) liquidation of assets, (iv) investment of funds, (v) administration of claims, and (vi) reporting to stakeholders. But much more flexibility is provided to the liquidator for performing these duties under a post-confirmation liquidation.

Protection of Assets

The goal is to maximize the present value of the cash proceeds of the estate which will ultimately be available for distribution to creditors. The liquidator must take whatever steps are necessary to protect assets of the estate. As in Chapter 7, the first task of a liquidator is to review the property of the estate and determine what steps need to be taken regarding maintenance, protection, and insurance. To the extent that such issues can be foreseen, the plan should provide the liquidator with general guidance in this area, as well as establish a procedure for making extraordinary decisions, such as the discontinuation of security or insurance.

Operation of Assets

Second, the liquidator may need to operate assets of the estate. Operations should not occur at a loss except under the most peculiar circumstances. One such circumstance arises when the operation of an asset preserves a “going concern” value that greatly exceeds the liquidation value. Another is when large noncash charges cause the operation to show losses for accounting purposes but nonetheless to generate positive cash flow. On the other hand, to the extent that the cost of maintaining assets may be offset by their operation, the liquidator has a clear duty to undertake that operation. The liquidator should have some leeway in overseeing operational assets that are part of the estate.

Liquidation of Assets

While the liquidator should have the authority to operate businesses owned by the estate, his or her true role is to liquidate those businesses sooner or later for the benefit of the estate. The liquidator should have the clear obligation to take appropriate steps to liquidate the estate. The mechanics of liquidation should be clearly set out in the plan. Liquidation by the liquidator without involvement of the bankruptcy court is often preferable. Nonetheless, some buyers, especially in connection with large asset dispositions, want an order from the bankruptcy court (“comfort orders”) approving the sale.

Investment of Funds

The liquidator has the duty to invest the estate’s funds. As a fundamental matter, the plan should provide that the liquidator invest the funds safely. Post-confirmation liquidations are often touted as being particularly superior to Chapter 7 liquidations in the flexibility that they provide for the investment of funds. The United States Trustee provides extremely restrictive and cautious requirements for depositing and handling of cash by a Chapter 7 trustee. Most creditors of bankrupt estates are willing to accept significantly greater risk in the management of the estate’s funds in exchange for the higher expected returns. The liquidator may hold a substantial amount of funds for fairly long periods of time between distributions. Accordingly, the liquidator needs to obtain the highest “safe” interest rate available. Also, the liquidator should be required to invest money with an eye toward its availability to pay costs and make distributions. Investments involving substantial, early withdrawal penalties should only be undertaken, if other funds are clearly sufficient for anticipated cash needs.

Administration of Claims

The liquidator has the principal responsibility of processing and, where appropriate, objecting to claims filed by creditors. The liquidating plan of reorganization should be structured to encourage prompt resolution of claim disputes. Eliminating improper claims improves the payout to those creditors who are entitled to payment, and resolution of a claim objection helps speed payment to all creditors. Maintaining substantial reserves against frivolous and disputed claims for a long period of time can be frustrating to creditors and may create other problems.

Seek Legal Help

An experienced Riverton Utah bankruptcy lawyer can represent creditors in a Chapter 11 bankruptcy, Chapter 7, or Chapter 13. The bankruptcy attorney will ensure that the liquidator discharges his responsibilities and acts in a fair manner.

Riverton Utah Bankruptcy Lawyer Free Consultation

When you need bankruptcy legal help, please call Ascent Law for your free consultation at (801) 676-5506. We want to help you.

Ascent Law LLC 8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506

Ascent Law LLC

4.9 stars – based on 67 reviews

Recent Posts

Is It Illegal To Withdraw Money From A Deceased Persons Account?

Corporate Lawyer Grantsville Utah

What Is The Fastest Way To Get Out of Debt?

FLP vs LLC

How To Get Custody Of Your Child In Utah

Are Divorce Rates Increasing?

from Michael Anderson https://www.ascentlawfirm.com/bankruptcy-lawyer-riverton-utah/ from Divorce Lawyer Nelson Farms Utah https://divorcelawyernelsonfarmsutah.tumblr.com/post/186883574975

Bankruptcy Lawyer Riverton Utah

When you need help to file bankruptcy, or someone has filed bankruptcy on you, call Ascent Law for your free consultation. We have bankruptcy attorneys on staff who are very familiar with the court process and can help you. Creditors in a Chapter 11 bankruptcy can play a vital role in supervising the role of the liquidator. In a Chapter 7 or 13 case, not so much. If you are a creditor in a Chapter 11 bankruptcy, hire the services of an experienced Riverton Utah bankruptcy lawyer to represent you.

How best to supervise the liquidator depends on the facts of the Chapter 11 case. A smaller case is likely to require less sophisticated supervision than a large one. A case in which the liquidation process is complex and multifaceted requires more supervision than one involving a small number of assets or just one or two items of litigation. If the debtor conducts a business preconfirmation, which is consistent with post-confirmation liquidation (e.g., sales of land in a discreet development), less supervision is required than if liquidation were not within the debtor’s ordinary business activities.

Protection of the Liquidator

An experienced Riverton Utah bankruptcy lawyer will ensure that the liquidator discharges his responsibilities in a fair manner and as required by Utah bankruptcy law. One of the liquidator’s first responsibilities is to ensure that the liquidation process and the representatives of creditors who conduct it are protected from unwarranted lawsuits. This requires a balancing of goals. On the one hand, lawsuit insulation is needed to provide assurance to the liquidator and the creditors that actions taken in good faith and furtherance of the liquidation process will not result in personal liability. On the other hand, creditors must, of course, have some recourse against a dishonest or incompetent liquidator. Finally, in certain situations protecting the estate and its representative from parties outside the liquidation process is more important than protecting parties within the process from each other.

The first problem area is the potential for litigation involving the liquidator’s conduct of the business, either pending or during the liquidation. The plaintiff may be either outside or within the process. A liquidator operating a business after confirmation of a plan of reorganization is susceptible to suit if he or she commits a tortuous or contractual wrong in connection with the operation of that business. A liquidator might also be attacked for his or her wrongful conduct of the business by one of the beneficiaries of the trust.

The liquidator might also inherit problems from the Chapter 11 case itself. For example, the liquidator may be responsible for holding assets with environmental problems. If the liquidator fails to handle these matters properly, he or she could be held personally liable for violations of environmental laws. Similarly, the liquidator who is not the Chapter 11 Trustee may be held liable for a failure to pay taxes or other governmental claims.

The plan of reorganization and other enabling documents should limit the liquidator’s liability to wrongful conduct that is willful, reckless, or grossly negligent. This type of provision is customary and the only practical protection available. The plan and other enabling documents should also provide for indemnification of the liquidator and others who may be vulnerable to suit for his or her conduct after confirmation of the plan.

Directors’ and officers’ (D&O) liability insurance may be available to the liquidator and the group governing the liquidator’s conduct. Ordinarily, D&O liability insurance is expensive to obtain for a debtor who is fresh out of Chapter 11 and undergoing liquidation.

To the extent that money or property come into the liquidator’s possession, he or she should be bonded. While these bonds are expensive, a creditors’ committee that fails to require a bond for a liquidator may find itself subject to criticism (and perhaps a lawsuit), if that liquidator breaches his or her trust.

Liquidator’s Attorney-Client Privilege

The liquidator has the ability to assert or waive the attorney-client privilege on behalf of the debtor. Problems arise when one or more members of a creditors’ committee does not fully understand the importance keeping matters discussed within the committee confidential. In the early stages of the liquidation, a liquidator and supervisory creditor group should determine what information will be disseminated to committee members and when it will be disseminated. The committee may want to restrict certain areas of confidential information to a subcommittee. Other than that, little can be done except to impress upon committee members the importance of maintaining the confidentiality of discussions within the committee.

Avoiding the Appearance of Impropriety

Liquidators must strive to avoid the appearance of impropriety. Typically, the liquidator is overseen by a group of creditor representatives. Usually, the largest creditors are on the supervising creditors’ committee. Frequently, one of these creditors has a substantial issue regarding the validity or enforceability of part or all of its claim. This individual creditor may well have both the ability and desire to intimidate the liquidator in order to discourage an objection or to receive other favorable treatment for its claim. A liquidator in this situation clearly has a problem. Certainly, the governing documents need to be drafted in such a way that the liquidator will not be discouraged from objecting to any particular claim, especially the claim of a creditor sitting in oversight. This issue can be dealt with in one of several ways. If necessary, court intervention can be requested. A less expensive solution is to require a substantial plurality of the oversight committee members to object to compensation. In the event that plurality is achieved, the governing documents can also require that court advice be sought. A practical and efficient way for the liquidator to handle this situation is to be very open and thorough in communicating with the members of the committee. Communication is the key here. All of the objections to the large claims should be communicated to the full committee in order to head off this issue in advance. The liquidator should communicate equally and completely with each one of the members of the governing body of creditors. This approach should help avoid a confrontation with one of the substantial creditors sitting in judgment of the liquidating trustee’s fees.

Funding the Liquidating Trust

The liquidator and the creditors frequently discuss how much money to hold and how long to hold it. Taxes can be an important issue. The first amount is set aside, after consulting with the trustee’s tax advisors, to cover any potentially conceivable tax liabilities until the liquidator is ready to close the estate and all the returns due to be filed have been blessed by the IRS. A delay of several years in closing the estate is not unusual for this reason. The liquidator must also hold back enough to cover all professional and trustee’s fees and maintain reserves sufficient to cover other liabilities that might be assessed against the liquidator. While maintaining this reserve may temporarily diminish the return to creditors, this approach is preferable to the liquidator facing large, personal liability for distributing money to the wrong recipients. In a liquidating trust established for the sole purpose of pursuing litigation, the trust must be funded at its inception with seed money. This amount is set aside at confirmation out of cash in the estate funds and used to fund the ongoing litigation. The fund may thereafter be increased with litigation proceeds as cases are settled or otherwise resolved. The liquidator often negotiates with his or her professionals for contingency fee arrangements or fee caps in order to avoid running out of money prior to the conclusion of litigation.

Compensation of the Liquidator under a Liquidating Plan

Compensation of the liquidator is negotiated in each case. The liquidator is typically identified in advance of plan confirmation. Compensation is addressed in the plan and disclosed in connection with solicitation of acceptances. If the name of the liquidator is not known until after confirmation, the plan should make provision for the negotiation of a compensation arrangement. In this instance, the plan should be flexible so that the committee or other entity empowered to oversee the liquidator can strike the best possible bargain.

The liquidator is commonly compensated on the basis of an hourly rate, an annual fee, a percentage of recovery, or some contingency or progress standard. Which of these ways of compensating a liquidator is best varies from case to case. In general, the larger estates tend to compensate the liquidator on more of an hourly rate, and the smaller estates tend to compensate the liquidator on a success-based formula. Typically, compensation plans provide for a minimum hourly rate. With all but the very largest billion-dollar estates, an incentive, or “kicker,” is used to motivate the liquidator to maximize the assets available for distribution. The incentive may be based on a percentage of the amount of money distributed in the estate or on the percentage of recoveries of the creditors under the plan. Obviously, the facts of each particular case control the weightings of compensation between hourly and contingency formulas. A prospective liquidator may decline the appointment if the method of compensation is not satisfactory. Flexibility on this particular issue is important. Without flexibility, persons who would otherwise be well suited to perform the role of liquidator may be unobtainable, resulting ultimately in detriment to the estate. The most effective liquidation is not necessarily the cheapest.

Compensation of the liquidator should be subject to some controls. Chapter 7 and Chapter 11 trustees are clearly subject to court control of compensation. The compensation of any other type of liquidator is subject to court scrutiny only when provided in the plan. The liquidating plan of reorganization should include a mechanism for review of the liquidator’s compensation under certain circumstances. Usually that mechanism relies only on the participation of the creditors’ committee or other oversight body. Court supervision is not usually required.

Duties of the Liquidator under a Liquidating Plan

The liquidating plan of reorganization should clearly define the liquidator’s functions. These functions are similar to those duties of a

Chapter 7 Trustee

While the functions may vary from case to case, the liquidator is expected to perform six general categories of duties: (i) protection of assets, (ii) operation of assets (to the extent appropriate), (iii) liquidation of assets, (iv) investment of funds, (v) administration of claims, and (vi) reporting to stakeholders. But much more flexibility is provided to the liquidator for performing these duties under a post-confirmation liquidation.

Protection of Assets

The goal is to maximize the present value of the cash proceeds of the estate which will ultimately be available for distribution to creditors. The liquidator must take whatever steps are necessary to protect assets of the estate. As in Chapter 7, the first task of a liquidator is to review the property of the estate and determine what steps need to be taken regarding maintenance, protection, and insurance. To the extent that such issues can be foreseen, the plan should provide the liquidator with general guidance in this area, as well as establish a procedure for making extraordinary decisions, such as the discontinuation of security or insurance.

Operation of Assets

Second, the liquidator may need to operate assets of the estate. Operations should not occur at a loss except under the most peculiar circumstances. One such circumstance arises when the operation of an asset preserves a “going concern” value that greatly exceeds the liquidation value. Another is when large noncash charges cause the operation to show losses for accounting purposes but nonetheless to generate positive cash flow. On the other hand, to the extent that the cost of maintaining assets may be offset by their operation, the liquidator has a clear duty to undertake that operation. The liquidator should have some leeway in overseeing operational assets that are part of the estate.

Liquidation of Assets

While the liquidator should have the authority to operate businesses owned by the estate, his or her true role is to liquidate those businesses sooner or later for the benefit of the estate. The liquidator should have the clear obligation to take appropriate steps to liquidate the estate. The mechanics of liquidation should be clearly set out in the plan. Liquidation by the liquidator without involvement of the bankruptcy court is often preferable. Nonetheless, some buyers, especially in connection with large asset dispositions, want an order from the bankruptcy court (“comfort orders”) approving the sale.

Investment of Funds

The liquidator has the duty to invest the estate’s funds. As a fundamental matter, the plan should provide that the liquidator invest the funds safely. Post-confirmation liquidations are often touted as being particularly superior to Chapter 7 liquidations in the flexibility that they provide for the investment of funds. The United States Trustee provides extremely restrictive and cautious requirements for depositing and handling of cash by a Chapter 7 trustee. Most creditors of bankrupt estates are willing to accept significantly greater risk in the management of the estate’s funds in exchange for the higher expected returns. The liquidator may hold a substantial amount of funds for fairly long periods of time between distributions. Accordingly, the liquidator needs to obtain the highest “safe” interest rate available. Also, the liquidator should be required to invest money with an eye toward its availability to pay costs and make distributions. Investments involving substantial, early withdrawal penalties should only be undertaken, if other funds are clearly sufficient for anticipated cash needs.

Administration of Claims

The liquidator has the principal responsibility of processing and, where appropriate, objecting to claims filed by creditors. The liquidating plan of reorganization should be structured to encourage prompt resolution of claim disputes. Eliminating improper claims improves the payout to those creditors who are entitled to payment, and resolution of a claim objection helps speed payment to all creditors. Maintaining substantial reserves against frivolous and disputed claims for a long period of time can be frustrating to creditors and may create other problems.

Seek Legal Help

An experienced Riverton Utah bankruptcy lawyer can represent creditors in a Chapter 11 bankruptcy, Chapter 7, or Chapter 13. The bankruptcy attorney will ensure that the liquidator discharges his responsibilities and acts in a fair manner.

Riverton Utah Bankruptcy Lawyer Free Consultation

When you need bankruptcy legal help, please call Ascent Law for your free consultation at (801) 676-5506. We want to help you.

Ascent Law LLC 8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506

Ascent Law LLC

4.9 stars – based on 67 reviews

Recent Posts

Is It Illegal To Withdraw Money From A Deceased Persons Account?

Corporate Lawyer Grantsville Utah

What Is The Fastest Way To Get Out of Debt?

FLP vs LLC

How To Get Custody Of Your Child In Utah

Are Divorce Rates Increasing?

Source: https://www.ascentlawfirm.com/bankruptcy-lawyer-riverton-utah/

Bankruptcy Lawyer Riverton Utah

When you need help to file bankruptcy, or someone has filed bankruptcy on you, call Ascent Law for your free consultation. We have bankruptcy attorneys on staff who are very familiar with the court process and can help you. Creditors in a Chapter 11 bankruptcy can play a vital role in supervising the role of the liquidator. In a Chapter 7 or 13 case, not so much. If you are a creditor in a Chapter 11 bankruptcy, hire the services of an experienced Riverton Utah bankruptcy lawyer to represent you.

How best to supervise the liquidator depends on the facts of the Chapter 11 case. A smaller case is likely to require less sophisticated supervision than a large one. A case in which the liquidation process is complex and multifaceted requires more supervision than one involving a small number of assets or just one or two items of litigation. If the debtor conducts a business preconfirmation, which is consistent with post-confirmation liquidation (e.g., sales of land in a discreet development), less supervision is required than if liquidation were not within the debtor’s ordinary business activities.

Protection of the Liquidator

An experienced Riverton Utah bankruptcy lawyer will ensure that the liquidator discharges his responsibilities in a fair manner and as required by Utah bankruptcy law. One of the liquidator’s first responsibilities is to ensure that the liquidation process and the representatives of creditors who conduct it are protected from unwarranted lawsuits. This requires a balancing of goals. On the one hand, lawsuit insulation is needed to provide assurance to the liquidator and the creditors that actions taken in good faith and furtherance of the liquidation process will not result in personal liability. On the other hand, creditors must, of course, have some recourse against a dishonest or incompetent liquidator. Finally, in certain situations protecting the estate and its representative from parties outside the liquidation process is more important than protecting parties within the process from each other.

The first problem area is the potential for litigation involving the liquidator’s conduct of the business, either pending or during the liquidation. The plaintiff may be either outside or within the process. A liquidator operating a business after confirmation of a plan of reorganization is susceptible to suit if he or she commits a tortuous or contractual wrong in connection with the operation of that business. A liquidator might also be attacked for his or her wrongful conduct of the business by one of the beneficiaries of the trust.

The liquidator might also inherit problems from the Chapter 11 case itself. For example, the liquidator may be responsible for holding assets with environmental problems. If the liquidator fails to handle these matters properly, he or she could be held personally liable for violations of environmental laws. Similarly, the liquidator who is not the Chapter 11 Trustee may be held liable for a failure to pay taxes or other governmental claims.

The plan of reorganization and other enabling documents should limit the liquidator’s liability to wrongful conduct that is willful, reckless, or grossly negligent. This type of provision is customary and the only practical protection available. The plan and other enabling documents should also provide for indemnification of the liquidator and others who may be vulnerable to suit for his or her conduct after confirmation of the plan.

Directors’ and officers’ (D&O) liability insurance may be available to the liquidator and the group governing the liquidator’s conduct. Ordinarily, D&O liability insurance is expensive to obtain for a debtor who is fresh out of Chapter 11 and undergoing liquidation.

To the extent that money or property come into the liquidator’s possession, he or she should be bonded. While these bonds are expensive, a creditors’ committee that fails to require a bond for a liquidator may find itself subject to criticism (and perhaps a lawsuit), if that liquidator breaches his or her trust.

Liquidator’s Attorney-Client Privilege

The liquidator has the ability to assert or waive the attorney-client privilege on behalf of the debtor. Problems arise when one or more members of a creditors’ committee does not fully understand the importance keeping matters discussed within the committee confidential. In the early stages of the liquidation, a liquidator and supervisory creditor group should determine what information will be disseminated to committee members and when it will be disseminated. The committee may want to restrict certain areas of confidential information to a subcommittee. Other than that, little can be done except to impress upon committee members the importance of maintaining the confidentiality of discussions within the committee.

Avoiding the Appearance of Impropriety

Liquidators must strive to avoid the appearance of impropriety. Typically, the liquidator is overseen by a group of creditor representatives. Usually, the largest creditors are on the supervising creditors’ committee. Frequently, one of these creditors has a substantial issue regarding the validity or enforceability of part or all of its claim. This individual creditor may well have both the ability and desire to intimidate the liquidator in order to discourage an objection or to receive other favorable treatment for its claim. A liquidator in this situation clearly has a problem. Certainly, the governing documents need to be drafted in such a way that the liquidator will not be discouraged from objecting to any particular claim, especially the claim of a creditor sitting in oversight. This issue can be dealt with in one of several ways. If necessary, court intervention can be requested. A less expensive solution is to require a substantial plurality of the oversight committee members to object to compensation. In the event that plurality is achieved, the governing documents can also require that court advice be sought. A practical and efficient way for the liquidator to handle this situation is to be very open and thorough in communicating with the members of the committee. Communication is the key here. All of the objections to the large claims should be communicated to the full committee in order to head off this issue in advance. The liquidator should communicate equally and completely with each one of the members of the governing body of creditors. This approach should help avoid a confrontation with one of the substantial creditors sitting in judgment of the liquidating trustee’s fees.

Funding the Liquidating Trust

The liquidator and the creditors frequently discuss how much money to hold and how long to hold it. Taxes can be an important issue. The first amount is set aside, after consulting with the trustee’s tax advisors, to cover any potentially conceivable tax liabilities until the liquidator is ready to close the estate and all the returns due to be filed have been blessed by the IRS. A delay of several years in closing the estate is not unusual for this reason. The liquidator must also hold back enough to cover all professional and trustee’s fees and maintain reserves sufficient to cover other liabilities that might be assessed against the liquidator. While maintaining this reserve may temporarily diminish the return to creditors, this approach is preferable to the liquidator facing large, personal liability for distributing money to the wrong recipients. In a liquidating trust established for the sole purpose of pursuing litigation, the trust must be funded at its inception with seed money. This amount is set aside at confirmation out of cash in the estate funds and used to fund the ongoing litigation. The fund may thereafter be increased with litigation proceeds as cases are settled or otherwise resolved. The liquidator often negotiates with his or her professionals for contingency fee arrangements or fee caps in order to avoid running out of money prior to the conclusion of litigation.

Compensation of the Liquidator under a Liquidating Plan

Compensation of the liquidator is negotiated in each case. The liquidator is typically identified in advance of plan confirmation. Compensation is addressed in the plan and disclosed in connection with solicitation of acceptances. If the name of the liquidator is not known until after confirmation, the plan should make provision for the negotiation of a compensation arrangement. In this instance, the plan should be flexible so that the committee or other entity empowered to oversee the liquidator can strike the best possible bargain.

The liquidator is commonly compensated on the basis of an hourly rate, an annual fee, a percentage of recovery, or some contingency or progress standard. Which of these ways of compensating a liquidator is best varies from case to case. In general, the larger estates tend to compensate the liquidator on more of an hourly rate, and the smaller estates tend to compensate the liquidator on a success-based formula. Typically, compensation plans provide for a minimum hourly rate. With all but the very largest billion-dollar estates, an incentive, or “kicker,” is used to motivate the liquidator to maximize the assets available for distribution. The incentive may be based on a percentage of the amount of money distributed in the estate or on the percentage of recoveries of the creditors under the plan. Obviously, the facts of each particular case control the weightings of compensation between hourly and contingency formulas. A prospective liquidator may decline the appointment if the method of compensation is not satisfactory. Flexibility on this particular issue is important. Without flexibility, persons who would otherwise be well suited to perform the role of liquidator may be unobtainable, resulting ultimately in detriment to the estate. The most effective liquidation is not necessarily the cheapest.

Compensation of the liquidator should be subject to some controls. Chapter 7 and Chapter 11 trustees are clearly subject to court control of compensation. The compensation of any other type of liquidator is subject to court scrutiny only when provided in the plan. The liquidating plan of reorganization should include a mechanism for review of the liquidator’s compensation under certain circumstances. Usually that mechanism relies only on the participation of the creditors’ committee or other oversight body. Court supervision is not usually required.

Duties of the Liquidator under a Liquidating Plan

The liquidating plan of reorganization should clearly define the liquidator’s functions. These functions are similar to those duties of a

Chapter 7 Trustee

While the functions may vary from case to case, the liquidator is expected to perform six general categories of duties: (i) protection of assets, (ii) operation of assets (to the extent appropriate), (iii) liquidation of assets, (iv) investment of funds, (v) administration of claims, and (vi) reporting to stakeholders. But much more flexibility is provided to the liquidator for performing these duties under a post-confirmation liquidation.

Protection of Assets

The goal is to maximize the present value of the cash proceeds of the estate which will ultimately be available for distribution to creditors. The liquidator must take whatever steps are necessary to protect assets of the estate. As in Chapter 7, the first task of a liquidator is to review the property of the estate and determine what steps need to be taken regarding maintenance, protection, and insurance. To the extent that such issues can be foreseen, the plan should provide the liquidator with general guidance in this area, as well as establish a procedure for making extraordinary decisions, such as the discontinuation of security or insurance.

Operation of Assets

Second, the liquidator may need to operate assets of the estate. Operations should not occur at a loss except under the most peculiar circumstances. One such circumstance arises when the operation of an asset preserves a “going concern” value that greatly exceeds the liquidation value. Another is when large noncash charges cause the operation to show losses for accounting purposes but nonetheless to generate positive cash flow. On the other hand, to the extent that the cost of maintaining assets may be offset by their operation, the liquidator has a clear duty to undertake that operation. The liquidator should have some leeway in overseeing operational assets that are part of the estate.

Liquidation of Assets

While the liquidator should have the authority to operate businesses owned by the estate, his or her true role is to liquidate those businesses sooner or later for the benefit of the estate. The liquidator should have the clear obligation to take appropriate steps to liquidate the estate. The mechanics of liquidation should be clearly set out in the plan. Liquidation by the liquidator without involvement of the bankruptcy court is often preferable. Nonetheless, some buyers, especially in connection with large asset dispositions, want an order from the bankruptcy court (“comfort orders”) approving the sale.

Investment of Funds

The liquidator has the duty to invest the estate’s funds. As a fundamental matter, the plan should provide that the liquidator invest the funds safely. Post-confirmation liquidations are often touted as being particularly superior to Chapter 7 liquidations in the flexibility that they provide for the investment of funds. The United States Trustee provides extremely restrictive and cautious requirements for depositing and handling of cash by a Chapter 7 trustee. Most creditors of bankrupt estates are willing to accept significantly greater risk in the management of the estate’s funds in exchange for the higher expected returns. The liquidator may hold a substantial amount of funds for fairly long periods of time between distributions. Accordingly, the liquidator needs to obtain the highest “safe” interest rate available. Also, the liquidator should be required to invest money with an eye toward its availability to pay costs and make distributions. Investments involving substantial, early withdrawal penalties should only be undertaken, if other funds are clearly sufficient for anticipated cash needs.

Administration of Claims

The liquidator has the principal responsibility of processing and, where appropriate, objecting to claims filed by creditors. The liquidating plan of reorganization should be structured to encourage prompt resolution of claim disputes. Eliminating improper claims improves the payout to those creditors who are entitled to payment, and resolution of a claim objection helps speed payment to all creditors. Maintaining substantial reserves against frivolous and disputed claims for a long period of time can be frustrating to creditors and may create other problems.

Seek Legal Help

An experienced Riverton Utah bankruptcy lawyer can represent creditors in a Chapter 11 bankruptcy, Chapter 7, or Chapter 13. The bankruptcy attorney will ensure that the liquidator discharges his responsibilities and acts in a fair manner.

Riverton Utah Bankruptcy Lawyer Free Consultation

When you need bankruptcy legal help, please call Ascent Law for your free consultation at (801) 676-5506. We want to help you.

Ascent Law LLC 8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506

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DropShipping: The 10 most common startup errors

More and more start-up companies in Germany are using DropShipping to fulfill their dream of their own online business. This is no wonder, because only with DropShipping it is possible to offer hundreds of products for sale in your own online shop or on eBay without having to buy a single product in advance.

The reasons for the failure of young companies are manifold

Whoever decides to found their own company naturally wishes to achieve maximum success with the business. At the very least, this means that the company will survive economically and generate enough money to provide the operator with a comfortable life. If this succeeds, then most of the wishes and dreams that led at the beginning to the fact that one has decided at all for a foundation come true.

If it does not succeed instead, then unfortunately one often has to struggle for a long time with the consequences and consequences of failure. So there is a lot to be said for dealing at an early stage with the question of why young companies fail at all. In this way, strategies can be developed in good time to avoid failure.

If we first take a rather general look at the reasons why young companies fail, we usually encounter gaps and deficiencies in terms of financing. The companies run out of financial breath during the start-up phase because the resulting costs were underestimated and the incoming revenues were overestimated. As a DropShipping dealer, you are more on the safe side here, as there are no special costs during the start-up and start-up phase and no high costs during ongoing operations.

Also DropShippers are not protected against missteps

Scheit can be a drop shipping company of course anyway. Here we often have to deal with very specific causes. These relate partly to e-commerce in general and partly to the drop shipping trading model in particular.

Among the causes based on the general characteristics of e-commerce, the lack of or incomplete market analysis should be mentioned above all. Those who, as founders, do not deal extensively with the potential of the targeted market risk financial shipwrecks. A lack of product knowledge has also brought down many a start-up project. If we turn our attention to those causes that relate specifically to drop shipping, then those reasons that are related to the suppliers are particularly noticeable here.

The manufacturers and wholesalers that DropShipping works with have a great responsibility and are instrumental in determining whether business is developing positively or negatively. Therefore, it is important to look here when it comes to finding and combating the most frequent mistakes at the start of drop shipping companies in advance.

Who knows the worst mistakes, can protect himself consciously and effectively

With founding mistakes, it’s such a thing. This includes the most common causes that can lead to the failure of a young company shortly after its launch. Inexperienced founders have the disadvantage that they often do not know these potentials well enough. This hardly gives them a chance to prepare adequately for what is to come. Unfortunately, one usually only has the appropriate experience when one has been in business for several years.

However, it is precisely then that knowledge about mistakes in setting up a company is of little use. Of course, such founders and entrepreneurs are particularly familiar with the causes of failure, as they have already experienced the economic collapse of their companies. Therefore we should find a way to know the most common mistakes of founders in the field of DropShipping without having to experience them ourselves. If this happens, then it is usually already too late.

Now, of course, one could turn to experienced entrepreneurs and ask them to accompany one’s own founding and start-up process and, above all, to make sure that not too many mistakes occur. The problem, however, is that on the one hand there are not very many entrepreneurs who are willing to provide such information, and on the other hand such entrepreneurs also work constantly rather than devote their precious time to advising and supporting future competitors. In search of a better and more realistic way, you will be interested in the following 10 sources of error, which we would like to present to you and give you along the way.

Successful learning from the mistakes of other DropShippers

We have compiled for you the most frequent and most serious causes of the failure of young companies. We have been guided by the e-commerce industry on the one hand and the DropShipping trading model on the other. Therefore, you do not expect unimportant commonplaces, but instead a very differentiated elaboration of the most frequent sources of error in exactly the business area you have chosen.

We recommend that you study the presented errors, reasons and causes very carefully. Try to internalize the individual sources of interference deeply and pay particular attention to the many recommendations in the text that will help you avoid these mistakes. With this you lay the stable foundation stone for a long-term stable company that is economically well off and provides you financially with everything you need.

You should avoid these errors at all costs

In order for a DropShipping trade to start successfully, it is important to exclude potential sources of error. Below are the ten most common mistakes made by inexperienced DropShipping resellers. Those who take these sources of error into account when setting up their own drop shipping business and consistently avoid them have good prospects of a profitable and flourishing company in the long term.

Error 1: Market and consumer interests disregarded

Products cannot be sold without a reasonable demand on the market and a corresponding interest on the part of consumers. Before you decide on a specific trading area, you should carefully analyze the market potential. In this context, do not only examine whether the respective goods are in high demand, but also get an accurate impression of the competition and the current prices on the market.

If you succeed in discovering a promising niche that has so far been little occupied, then your chances of successful sales will increase. If you have well-founded doubts about the success potential of products, then you prefer to choose a different product area.

Error 2: Too little time is invested in the selection of suppliers

Anyone who’s too quick for a DropShipping Suppliers who risks overlooking crucial details. Every potential drop-shipping provider has to be put through its paces before starting a concrete cooperation. This requires comprehensive research, which ideally also involves personal discussions. One way to get in touch with potential suppliers is through appropriate trade fairs and commercial exhibitions.

Extensively test the efficiency of the potential wholesaler. Make some test orders and especially check the quality of the products and the reliability of the delivery. Question existing customers of the respective supplier about their Experience with DropShipping at the company and search the Internet for opinions and ratings.

Error 3: Conditions with suppliers are not well negotiated

The profit is made on the purchase. Remember this old principle of successful merchants and check the purchase prices of your DropShipping suppliers carefully. Wrong shame in negotiating list prices is out of place here. Your counterpart is an experienced dealer and will not feel attacked by an open request for special discounts and better prices.

However, do not only consider the pure product price, but also agree the costs and fees for shipping and handling with your suppliers. Please also talk about minimum order quantities and any surcharges for small quantities that may apply. These conditions must in any case be clearly agreed before the start of the cooperation, as they are very decisive for your future profits.

Error 4: Products are traded that you don’t understand.

When selecting a product area, you should not be guided solely by market opportunities and achievable profit margins. Make sure that you have as much personal reference as possible to your future product range. Keep in mind that you can describe and document products that you know well much better. As a specialist stranger, the compilation of a consumer-oriented assortment would already present you with an almost unsolvable task.

When choosing a specific product group, remember that you need to answer customer questions regularly, both before and after the purchase. If you decide on products that interest you personally, you will follow the markets, the technical innovations and the trends anyway and will not have to invest additional working time for this.

Error 5: The costs in the DropShipping trade are underestimated

Those who opt for a business model based on drop shipping often have the low start-up costs in mind. Even if this business model requires considerably less capital than a comparable concept in classic trading, you will still have to bear various costs. You should be aware of these and take them carefully into account in your planning. Think, for example, of the software and design of your future online shop and the expenses for programming interfaces to the respective suppliers.

In addition, calculate the costs of setting up your future workplace, creating business stationery and include the advertising and marketing expenses necessary to make your future shop known on the Internet. Although drop shipping allows you to dispense with a warehouse and staff for warehousing and shipping, you should consider early on who can support you in handling customer inquiries and support tasks and what this support will cost you.

Error 6: No regulations are made with return of goods

If you sell products on the Internet to private customers, then you are legally obliged to grant the buyer a 14-day right of return. Remember that this right does not apply between you and your DropShipping supplier. This is due to the fact that there is trade between merchants here and that in this environment the rules of private consumer protection do not apply. Under certain circumstances it may be possible to agree an extraordinary right of return with the DropShipping supplier.

If your supplier is not prepared to do this, you should plan to sell returns on eBay. Keep in mind that you will not normally achieve the originally planned sales price with such returns. Please also clarify with your DropShipping suppliers how to proceed in warranty and guarantee cases. In any case, agree to whom the customer can return a defective product during the warranty period and how it will be replaced.

Error 7: Communication with the supplier is inadequate

In order to convince yourself of the efficiency of a drop shipping supplier of your choice, you should personally and locally get an exact picture of the company of the future partner. Although today a large part of commercial communication is handled by telephone or e-mail, personal contact, especially at the beginning of the cooperation, cannot be replaced by anything else. In direct dialogue, you have better opportunities to negotiate concrete prices and conditions.

In the premises of your potential supplier you can get a comprehensive picture of the seriousness and efficiency of the company. Check whether the products offered are actually in the warehouse and have the processing structures and processes in the company explained to you. Pay particular attention to how quickly incoming orders are processed and ordered goods shipped.

Error 8: The amount of work is underestimated

Online trading via drop shipping involves considerably less processing effort than traditional mail order trading. However, even the modern form of online trading cannot do without planning and structure. It is therefore imperative that you plan in indispensable work steps and increased time requirements.

On the one hand, you should not underestimate the effort involved in the careful care of prospective buyers and customers. On the other hand, the business relationship with your drop shipping suppliers can also involve a greater amount of work if, for example, inventories have to be transferred manually instead of being updated via a data interface.

Error 9: The ability of the goods to be delivered is not checked optimally.

As a drop-shipping online retailer, it is your responsibility to verify the delivery capability of the products you offer. If a product is not available or only available late, this is due to your reputation as an Internet trader. When trading drop-shipping products on eBay, even the seller guidelines oblige you as a seller to make sure that the products can be shipped immediately after the sale.

The consequences of delayed availability of products can also affect you economically. For example, if a customer orders two products, one of which is not available on schedule, you usually pay twice the shipping costs.

Error 10: Goods with high return rates are selected

Product returns are part of the daily routine of every online retailer. Both the law and the general rules for customer friendliness require an unconditional right of return of at least 14 days. In many cases, returned goods can no longer be sold regularly, but must instead be sold elsewhere, usually at a lower price. The resulting losses are to be borne by the online merchant himself.

Against this background, the product areas envisaged should also be reviewed with regard to the return rate to be expected. The market knows of various product categories which are particularly susceptible to returns and can therefore be classified as unsuitable for drop shipping. An example of this is the clothing sector. Here, the return rates can reach up to 40 percent in some cases.

If you know the most serious mistakes, then you are in the best position to avoid them consistently. To complete the picture, we provide you in our guidebook in addition 7 stumbling blocks on the road to success in front of you. So you are optimally prepared to do everything right.

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