![]() In an individual case, failure of the debtor to pay post-petition domestic support obligations constitutes "cause" for dismissal or conversion. Additionally, failure to file a disclosure statement or to file and confirm a plan within the time fixed by the Bankruptcy Code or order of the court inability to effectuate a plan denial or revocation of confirmation inability to consummate a confirmed plan represent "cause" for dismissal under the statute. trustee and failure to timely pay post-petition taxes or timely file post-petition returns. 2004 examination without good cause failure to timely provide information to the U.S. For example, the moving party may establish cause by showing that there is substantial or continuing loss to the estate and the absence of a reasonable likelihood of rehabilitation gross mismanagement of the estate failure to maintain insurance that poses a risk to the estate or the public or unauthorized use of cash collateral that is substantially harmful to a creditor.Ĭause for dismissal or conversion also includes an unexcused failure to timely comply with reporting and filing requirements failure to attend the meeting of creditors or attend a Fed. ![]() Section 1112(b)(4) of the Bankruptcy Code sets forth numerous examples of cause that would support dismissal or conversion. ![]() Alternatively, the court may decide that appointment of a chapter 11 trustee or an examiner is in the best interests of creditors and the estate. A debtor in a chapter 11 case does not have an absolute right to have the case dismissed upon request.Ī party in interest may file a motion to dismiss or convert a chapter 11 case to a chapter 7 case "for cause." Generally, if cause is established after notice and hearing, the court must convert or dismiss the case (whichever is in the best interests of creditors and the estate) unless it specifically finds that the requested conversion or dismissal is not in the best interest of creditors and the estate. ![]() A debtor in a case under chapter 11 has a one-time absolute right to convert the chapter 11 case to a case under chapter 7 unless: (1) the debtor is not a debtor in possession (2) the case originally was commenced as an involuntary case under chapter 11 or (3) the case was converted to a case under chapter 11 other than at the debtor's request. ![]()
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