New Jersey business bankruptcy can lead to financial questions

Business owners in New Jersey may be interested to learn about a case involving the closure of a non-profit organization in another state. The non-profit was a corporate entity that had an endowment attached t it. Recently, the corporation filed for a business bankruptcy after its patient load dropped dramatically.

According to a recent report, the corporation ran a hospice for the care of dying people in another state. The business began in the 1970s. However, in the 1980s, an endowment was created that used donations and investments from individuals to fund the hospice facility.

At question currently is whether the funds being held by the endowment can be attached by creditors involved in the business bankruptcy of the corporation. Currently, the endowment is protected from the multitude of creditors left by the corporation. However, as creditors attempt to make claims to the funds still retained by the endowment, a bankruptcy court may be asked to decide if the two businesses that had been run together for many years must are equally responsible for the same debts.

Running parallel businesses in New Jersey can lead to issues similar to those in this business bankruptcy case. When business owners use the funds from one entity to help pay for another, the businesses may become intertwined. If that is the case, it may be necessary to seek court intervention, should one of the business ventures fail and file for a business bankruptcy. Before filling, a business owner may benefit from a careful review of the rules surrounding the bankruptcy process.

Source: UTSanDiego.com, "Hospice endowment not mixed in with bankruptcy," Jeff McDonald, March 12, 2013

No Comments

Leave a comment
Comment Information
EMAIL US FOR A RESPONSE

Get Our Help Today

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Office Locations

Cherry Hill Office
1060 North Kings Highway,Suite 333
Cherry Hill, NJ 08034

Toll Free: 800-759-0767
Phone: 856-254-2196
Fax: 856-414-1230
Map & Directions

Philadelphia Office
Suite 1505
1515 Market Street
Philadelphia, PA 19102

Toll Free: 800-759-0767
Phone: 215-928-9199
Map & Directions

Mount Holly Office
1848 Burlington-Mount Holly Rd
Mount Holly, NJ 08060

Toll Free: 800-759-0767
Phone: 856-254-2196
Map & Directions

Philadelphia Office
7909 Bustleton Avenue
Philadelphia, PA 19152

Toll Free: 800-759-0767
Phone: 215-928-9199
Map & Directions