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Exam 35: Bankruptcy

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Question 21

Multiple Choice

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Which of the following debts is not dischargeable in bankruptcy?

A) judgments based on negligence
B) judgments based on breach of contract
C) judgments for willful and malicious injuries
D) judgments in which the creditors would receive no distribution

E) B) and D)
F) A) and B)

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Question 22

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With regard to priority of claims in the payment of unsecured debts, which of the following has priority over alimony and child support obligations?

A) costs and expenses of the administration of the bankruptcy case.
B) claims arising in the ordinary course of the debtor's business after commencement of the case
C) claims for wages, salaries or commissions earned within 180 days before the filing of the petition
D) none of the above

E) All of the above
F) None of the above

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Question 23

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A debtor is presumed to be insolvent on and during what number of days immediately preceding the date of the filing of a bankruptcy petition?

A court can dismiss an individual debtor's petition if the debtor does not satisfy the means test.

The creditors of Sara Delano have petitioned for involuntary bankruptcy proceedings against her. Delano has been consistently late in paying her obligations for the past year. Two months before the petition was filed, a custodian was appointed to protect Delano's property. In her statement contesting the bankruptcy petition, Delano pointed out that she had dealt in good faith and could not be shown to be guilty of any act of misconduct. In addition, she cited her willingness to allow a custodian to be appointed as an indication of her intention to avoid bankruptcy and honor her obligations. Can she prevail?

The filing of an involuntary case petition automatically constitutes an order for relief if the debtor fails to contest the petition within the time specified by the Bankruptcy Code.

A bank may file a voluntary petition with the bankruptcy court.

A reorganization plan may, in certain instances, provide for the rejection of executory contracts or collective bargaining agreements.

An order for relief will be granted in an uncontested involuntary case if, within 120 days before the date of the filing of the petition, a custodian has been appointed for the debtor's property.

By operation of law, the trustee automatically becomes the owner of all of the debtor's property in excess of the property to which the debtor is entitled under exemption laws.

A debtor may recover damages against any creditor who filed a bankruptcy petition in bad faith.

The holder of a claim that is the subject of a bona fide dispute may be counted as a petitioning creditor.

Under the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, a discharge is available only once every ten (10) years.

Creditors who hold security for payment, such as a lien or a mortgage on the debtor's property, are not affected by the debtor's bankruptcy.

A discharge does not release a person from a consumer debt to a single creditor totaling more than $5,550 for luxury goods or services if the debt was incurred within how many days of the order for relief?

An involuntary petition in bankruptcy may not be commenced against:

Confirmation of an extended time payment plan releases a debtor from liability for all debts that would be discharged by an ordinary bankruptcy discharge.

To be set aside as a preference, a transfer must be fraudulent.

Chapter 7 is:

The filing of a voluntary, but not an involuntary, petition operates as an automatic stay.