General Assignment For The Benefit Of Creditors

General Assignment For The Benefit Of Creditors-71
He may compromise, settle and compound all claims, disputes and litigations of the assignor, refer the same to arbitration, agree with any person concerning the same, redeem all mortgages and conditional contracts, and generally act as and do whatsoever the assignor might have lawfully done in the premises." Second, the assignee also "represent[s] the assignor's entire creditor constituency." ... He may sue for and recover in his own name everything belonging or appertaining to the estate.

He may compromise, settle and compound all claims, disputes and litigations of the assignor, refer the same to arbitration, agree with any person concerning the same, redeem all mortgages and conditional contracts, and generally act as and do whatsoever the assignor might have lawfully done in the premises." Second, the assignee also "represent[s] the assignor's entire creditor constituency." ... He may sue for and recover in his own name everything belonging or appertaining to the estate.

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However, unlike a Chapter 7 bankruptcy, the Assignor can select the independent third party (the "Assignee") to whom the Assignor voluntarily assigns by transfer or conveyance all of the assets in trust.

Assignments generally proceed much more quickly and efficiently that bankruptcies, and may produce better results and a higher dividend for creditors. An Assignment is voluntarily commenced by the Assignor by executing a formal "Deed of Assignment" in favor of the Assignee.

This can be through a private sale or a public auction. The Surrogate of the county examines and approves the final accounting of the assignee.

The Assignee will liquidate those assets, whether in a bulk or turn-key sale, or through a piecemeal auction, in order to generate the maximum liquidation value for those assets. If the court approves the accounts, formal papers are filed to complete the case and creditors are given their dividends.

The Assignee will immediately inspect, secure, and safeguard the Assignor's assets for the benefit of the Assignor's creditors.

Execution of the Deed of Assignment vests in the Assignee legal title to all the Assignor's real and personal property, including property located outside of New Jersey.

In New Jersey, assignment for the benefit of creditors proceeding are governed by the Assignment for Benefit of Creditors Statute (the statute), 2A:19-2.

An “assignee” is an independent third party to whom the business distributing its assets, known as the “assignor”, conveys or assigns, all of its assets in trust. Subject to certain exceptions, the assignee has the power to dispose of all of the property that the assignor owned at the time of the assignment.

Assignments can be pursuant to statute, or common law, but Assignments are not recognized/utilized in all states. This Deed of Assignment is similar to a real estate deed, and must generally be recorded by the Assignee in the county clerk's office in the county where the Assignor's principal office is located.

Assignments may be commenced by individual Assignors, however, individual Assignments are not usually the best option for individuals because, unlike a bankruptcy proceeding, the Assignor does not receive a discharge.

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