Broker owes agents commissions & filed Ch.11

[REAgent]

What is the name of your state? Utah
My brokerage did not pay me a commission of $4600. (due Oct. 16) as well as 7-8 other agents. I kept getting excuses and now they have filed for Chapter 11. Should I file a small claims or a civil suit and will the Ch. 11 dissolve their obligation to pay me and the other creditors? Is a mechanics lien an option?
Thanks for your assistance. REAgent

 

[moburkes]

You don't file a lawsuit against someone, to collect a debt, when they have filed bankruptcy. You must file forms with the BK court for your claim.

 

[azatty]

File a proof of claim form identifying the debt owed to you as a "priority claim" for unpaid wages. Unpaid wages of up to $10,000.00 enjoy priority status if the wages become owed within 120 before the date of the bankruptcy filing. In order to confirm his Chapter 11 Plan, the broker will have to pay allowed priority claims in full, although it will be some time in coming.

In some Chapter 11 cases where wages become payable shortly after (or even before) the filing date, we will request permission from the court in our "first day orders" to pay those claims because the employees are critical to continued business operations. I can't say if that's your case, though. You should consult with a local bankruptcy attorney on the issue.

Don't file a lawsuit without first seeking permission from the bankruptcy court.