Meeting of creditors is a bankruptcy proceeding in which the creditors of a debtor meet in court to present their claims against the debtor. The process entails the physical or virtual meeting of all companies or individuals who have extended credit to the debtor and is intended to provide the creditors an opportunity to protect their interests in the proceedings.
The Meeting of Creditors is conducted in all Chapter 13 and 7 bankruptcy cases. The Meeting of Creditors is also known as 341 Meeting of Creditors, which references the Bankruptcy Code section which requires this meeting.
The Federal Rules of Bankruptcy Procedure require that the Meeting of Creditors be held anywhere between 21 and 40 days after the bankruptcy filing for Chapter 7 cases and anywhere between 21 and 50 days after the bankruptcy filing in Chapter 13 cases.
In a 341 meeting, a trustee is named to handle the application of the debtor’s assets and to pay all the debts. The trustee calls the first meeting of creditors for the following reasons:
- to consider the situations of the bankrupt;
- to establish the appointment of the trustee or replace with another in place thereof;
- to appoint inspectors; or
- to give such directions to the trustee as the creditors may see fit with reference to the administration of the estate.