Arizona-based Fulton Homes filed for Chapter 11 bankruptcy protection over two years ago. It was again in the news recently because the bankruptcy judged ordered Fulton Homes and its main creditor to mediate the amount owed.
In many senses, a Chapter 11 bankruptcy is more an extended negotiation than anything else. To be confirmed, there must be at least one class of creditors who agrees to the debtor’s plan.
The type of dispute at issue in the Fulton Homes case is not unusual. In most cases, Bankruptcy courts can hold trial on such disputes fairly quickly. There are, however, advantages to a voluntary resolution. A settlement can avoid the delays inherent an appeal of a central issue.
As mentioned in the article, the bankruptcy courts do have mediation programs available for cases which neither the parties nor the court can easily and quickly resolve.
If you are considering requesting Chapter 11 bankruptcy protection, you should consult with an attorney familiar with Chapter 11 bankruptcies to discuss your options. For a free consultation, call (480) 719-1152.