Benezett Reorganization Lawyer, Pennsylvania

(1) The state of being liable--that is, legally responsible for an act or omission. Example:Peri hires Paul to fix a broken pipe in her bathroom, but the new pipe bursts the day after Paul installs it, ruining the bathroom floor. This raises the issue of liability: Who is responsible for the damage? Peri claims that Paul is responsible, and sues him for the cost of hiring another plumber to fix the pipe and replacing the floor. Paul, in turn, claims that the pipe manufacturer is responsible, because they supplied him with faulty materials. Both Peri and Paul must prove their claims in court; if Paul and/or the manufacturer is found liable, one or both will have to pay damages to Peri. (2) Something for which a person is liable. For example, a debt is often called a liability.

A court-ordered process that takes property from a person to satisfy a debt. For example, a person who owes money to a creditor may have her wages garnished if she loses a lawsuit filed by the creditor. Up to 25% of a person's wages can be deducted.

A person appointed by the court to oversee the case of a person or business that has filed for bankruptcy. In a consumer Chapter 7 case, the trustee's role is to gather the debtor's nonexempt property, liquidate it and distribute it proportionally to her creditors. In a Chapter 13 case, the trustee's role is to receive the debtor's monthly payments and distribute them proportionally to her creditors.

A person who joins with at least one other to own and operate a business for profit -- and who (unlike a corporation's owners), is personally liable for all the business's debts and obligations. A general partner's actions can legally bind the entire business. See also partnership, limited partnership.

A federal law that gives you rights when an error occurs on your credit card statement. You must notify the credit card company of the mistake within 60 days after it mailed the bill to you. The company must then correct the mistake, or at least acknowledge receipt of your letter within 30 days, and must correct the error within 90 days or explain why it believes the credit card statement is correct.

In a bankruptcy case, a transfer of property to another for less than the property's value for the purpose of hiding the property from the bankruptcy trustee -- for instance, when a debtor signs a car over to a relative to keep it out of the bankruptcy estate. Fraudulently transferred property can be recovered and sold by the trustee for the benefit of the creditors.

A type of debt that is paid first if there are distributions made from the bankruptcy estate in a Chapter 7 bankruptcy, and must be paid in full in a Chapter 13 bankruptcy. Priority debts include alimony and child support, fees owed to the trustee and the attorney in the bankruptcy case, and wages owed to employees.