I’ve been sued for a preference (and don’t feel preferred at all)
Editor’s Note: Paul A. Fanning is the head of the Financial Institutions and Creditors’ Rights Practice Groups at Ward and Smith, P.A. My business received a demand letter from a bankruptcy trustee for a bankrupt customer asking me to return payments I received for goods and services provided to the customer. Do I have to return the payments? Beware of Preferences By way of background, a “preference claim” in a bankruptcy case is a legal device created by Congress. The purpose of the preference claim is to ensure that all similarly-situated creditors receive equal treatment for their claims or,...
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