A Chapter 13 trustee is an individual who is appointed by the U.S. Trustee’s Office to be the trustee of the bankruptcy estate of each person who files for Chapter 13 bankruptcy relief. Bankruptcy judges do not handle the day-to-day administration of cases. The Chapter 13 trustee usually has a large staff including his or her own attorneys. In the Northern District of California, there are different Chapter 13 trustees for the Oakland division, the San Jose division and the San Francisco division. The Chapter 13 trustee is responsible for the administration of the bankruptcy estate and does not represent either the creditors or the debtors. For those in Walnut Creek and the rest of Contra Costa County, our trustee is based out of Hayward, California.
The primary duties of the trustee are to collect payments from the debtor, make payments to creditors, ensure that the plan is followed, and administer the case until it is closed. The trustee also will be the one who will examine the debtor under oath at his or her meeting of creditors. When the case is filed, the trustee’s office reviews all of the documents filed by the debtor which include the bankruptcy petition, schedules, statement of financial affairs and most importantly the chapter 13 plan. The goal of debtors is to get the chapter 13 trustee to recommend confirmation of their chapter 13 plan so that the case administration can move forward. Not getting a plan confirmed will result in the dismissal of the case.
The Chapter 13 trustee is assigned to the case from the day the case is filed until the day the case is closed. That time period can be up to 5 years. The trustee’s office monitors all documents that are filed with the court. During the case, debtors sometimes have to modify their chapter 13 plan. The trustee will review the modification motion and can object as necessary to ensure the case is properly administered. The trustee monitors the payments made by the debtor. Debtors have to make a monthly payment. If the debtor fails to make timely monthly payments, the trustee can file a motion to dismiss the case. The trustee will also deal with sales of real estate. Sometimes a debtor has to sell real property to properly fund their chapter 13 plan or to pay off the mortgage company. The trustee has the power to approve sales or refinances without a court order. The trustee will deal with the debtor, debtor’s attorney and the title company. The trustee will even get involved if the debtor needs to get financing for a new car. The trustee has to approve any car loans incurred while a debtor is making their plan payment.
Call David A. Arietta at (925) 472-8000 to go over questions about Chapter 13.