As soon as possible after issuing the order for relief, the court appoints an interim trustee to take charge until a permanent trustee is selected, and then a meeting of creditors is called. Creditors either may elect a permanent trustee or have the interim trustee serve in that capacity. Proofs of claim are examined by the trustee, who may accept them or, if they are improper, disallow them. To be considered in the settlement, a claim normally must be filed within 90 days after the date set for the first meeting of creditors.
The debtor is required to be present at the meeting of creditors in order to be subject to examination by the creditors or the trustee and must cooperate with the trustee in the preparation of an inventory of property, the examination of proofs of claim, and the general administration of the estate. To assist the trustee, a debtor files a statement of affairs, consisting of answers to a series of stated questions about the identity of the debtor’s records and books, transactions, and events affecting the financial condition of the debtor, including any prior bankruptcy proceedings. This legal statement of affairs is not to be confused with the accounting statement of affairs.
Duties of Trustee.
The trustee shall:
1. Collect and reduce to money the nonexempt property of the estate.
2. Account for all money and property received, maintaining a record of cash receipts and disbursements.
3. Investigate the financial affairs of the debtor, including a review of the forms filed by the debtor.
4. Examine proofs of claim and disallow any improper claim.
5. Furnish information reasonably requested by a party of interest.
6. Operate the business of the debtor, if any, when so authorized by the court if such operation is in the best interest of the estate and consistent with its orderly liquidation.
7. Pay dividends to creditors as promptly as practicable, with regard for priorities. (The law applies the term “dividend” to any payment made to a creditor.)
8. File reports of progress, with the final report accompanied by a detailed statement of receipts and disbursements.