The Agreement with Creditors in the Bankruptcy Procedure
If your company is in a situation of insolvency and you have been forced to open a creditor’s contest, at Lawyers & Accountants we can and want to help you, since we specialize in bankruptcy law, and we will take care of informing and advising you, as well as all management, ensuring compliance with Article 2.1 of the Bankruptcy Law.
We have a large team of lawyers specialized in bankruptcy/creditor’s contest in Madrid, who will be in charge of managing the insolvency proceedings in its entirety, simplifying and expediting all the corresponding procedures, which will allow you to save time, reduce costs and meet deadlines.
If you are looking for a bankruptcy lawyer, at Lawyers & Accountants we offer a comprehensive management service for contest of creditors. Get in touch with us
When a company is in insolvency, the creditor’s contest, insolvency proceeding, may be the best option to continue the business, without debts being an impediment to doing so, thus making it viable again in the future, or to put an end to business activity in an appropriate manner.
This is a legal procedure whose objective is to solve the problems of insolvency and/or lack of liquidity, allowing to the creditors the collecting of debts that are overdue, and looking for the most appropriate solutions not to bring a business to bankruptcy.
The creditor’s contest applies to all types of business:
The creditor’s contest must be requested to a judge, when, as established by the Bankruptcy Law, a business cannot comply with its credit obligations, because it is experiencing serious economic difficulties. On the basis of the documentation submitted, the judge shall decide whether to grant the creditor contest.
Once the creditor’s contest has been submitted, the judge immediately suspends all payments to be made by the company, and will freeze the interest associated with the debts, for the duration of the creditor contest.
Likewise, it will be the judge who takes the reins of the company, delegating its control to insolvency administrators (lawyer, auditor or economist, and representative of creditors).
We are talking about voluntary creditor’s contest/voluntary insolvency proceedings, when it is the insolvent company itself that makes the request on a voluntary basis.
The application must be made within two months from the date on which the insolvency problem is detected, as prescribed by the Bankruptcy Law, since otherwise it could be sanctioned and even criminally charged. To do so, the following documents must be submitted:
Necessary creditor’s contest / Necesary insolvency proceedings
Instead, the request is made by one of the partners or creditors, it shall be known as a necessary creditor’s contest/necessary Insolvency procededings. In this case, the judge will be responsible for handling the request, and he will decide if it is finally carried out.
In this type of creditor’s contest, the application must be based on facts demonstrating the failure of the company to comply with general obligations.
The directors shall determine the value of the set of assets and rights of the enterprise, which may be used to satisfy creditors, within two months.
There are two different types of end of creditor’s contest:
If your company is in insolvency and you are considering the possibility of applying for a creditor contests, at Lawyers & Accountants we will advise you to find the best solution to safeguard your assets, and thus avoid personal liability of both partners and directors.
We are specialized in bankruptcy law and in the registration of creditor’s contest, and a bankruptcy lawyer will treat your particular case, personalized and with total professionalism, taking care of the management of the contest to obtain the best solutions for you and your business, and comply with the current Bankruptcy Law.