Trustee

Trustee becomes the legal representative of the debtor and gets legal title to the property

Debtor must turn over all his records to the trustee

Who is the Trustee?
Can be a lawyer, accountant, business person. If a large case, he may even have an entire staff

Large Case
Small Case
 * The largest group of creditors will strike a deal and choose who the trustee will be Ex: Enron
 * Creditors will also create committees (equity creditors, etc.)
 * There is a list of trustees from which the judge may assign case

Duties
Facilitation
 * Examines the Proof of Claims filed by the creditors and will challenge them where appropriate
 * Brings and oversees lawsuits already brought on behalf of the estate

Investigation

 * Reviews the schedules of debt and separates the unsecured from the secured property
 * Investigates debtor's financial affairs
 * Where appropriate, gets individual professionals to assist in the administration of the estate

Manages the Estate
At final meeting of creditors, the trustee presents a detailed statement of the administration of the bankruptcy estate. May even recommend that the debtor not be discharged
 * Takes possession of all debtor's property = estate
 * Sets aside the property that is exempt under state law or federal law
 * To the extent the estate is in cash, deposit or invest the cash
 * Will sell and dispose of property in the estate
 * Must make periodic reports to court and debtor on how much he is receiving from the sale of property

Trustee gets paid out of the estate - money from the estate goes first to the trustee and then to bankruptcy attorneys

Trustee can avoid liens on property (for antecedent debt) if they are gotten within 90 days preceding debtor's filing of the petition