Farm bankruptcy 2

A lawyer’s take on agricultural bankruptcy. Patrick Geile’s, an attorney who's a buddy of mine and the other day surprised me by telling me that he does a lot of agricultural bankruptcy cases. Being nosy. I had a question for him. I'm a rancher, dairymen, crop producer, and I'm in trouble. And you're going to represent me. What do you do? How do you help me?

I start compiling my own research. Typically through entity searches as well as the UCC filings. And a UCC is the document that a lender uses to secure the loan on the debtor's equipment.

I've never been clear on this. Let's project that a rancher, farmer, dairymen is declaring bankruptcy. Does that allow him to resolve his debts? What happens when a guy declares bankruptcy?

That stops collection activity. That's called an automatic stay. So the first thing it does is it stops all that collection activity. Second thing it does is it creates the concept of a bankruptcy estate. And that's all the debtor’s stuff. Real property, equipment, whatever it is. Chapter twelve is really a true reorganization. They're really trying to figure out a way to pay back all of their creditors. And by the way, most Chapter Twelve’s do repay all their creditors in full, but they reorganize their short term obligations into a long term obligation.

Hey, you can always count on a farmer to do the right thing.