Bankruptcy Forms: Filing Bankruptcy Chapter 7 Bankruptcy Software Chapter 13

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TITLE 11–BANKRUPTCY

CHAPTER 5–CREDITORS, THE DEBTOR, AND THE ESTATE

Sub Chapter – Creditors and Claims

Sec. 508. Effect of distribution other than under this title

   (a) If a creditor receives, in a foreign proceeding, payment of, or 
a transfer of property on account of, a claim that is allowed under this 
title, such creditor may not receive any payment under this title on 
account of such claim until each of the other holders of claims on 
account of which such holders are entitled to share equally with such 
creditor under this title has received payment under this title equal in 
value to the consideration received by such creditor in such foreign 
proceeding.
    (b) If a creditor of a partnership debtor receives, from a general 
partner that is not a debtor in a case under chapter 7 of this title, 
payment of, or a transfer of property on account of, a claim that is 
allowed under this title and that is not secured by a lien on property 
of such partner, such creditor may not receive any payment under this 
title on account of such claim until each of the other holders of claims 
on account of which such holders are entitled to share equally with such 
creditor under this title has received payment under this title equal in 
value to the consideration received by such creditor from such general 
partner.

(Pub. L. 95-598, Nov. 6, 1978, 92 Stat. 2585.)


                      Historical and Revision Notes

                         legislative statements

    Section 508(b) of the House amendment is new and provides an 
identical rule with respect to a creditor of a partnership who receives 
payment from a partner, to that of a creditor of a debtor who receives a 
payment in a foreign proceeding involving the debtor.


                        senate report no. 95-989

    This section prohibits a creditor from receiving any distribution in 
the bankruptcy case if he has received payment of a portion of his claim 
in a foreign proceeding, until the other creditors in the bankruptcy 
case in this country that are entitled to share equally with that 
creditor have received as much as he has in the foreign proceeding.


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Note: For affordable legal assistance The Center For Debt Management highly recommends Standard Legal's Do-It-Yourself Bankruptcy Forms Software Kits. For credit repair services,
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For more bankruptcy help and bankruptcy alternatives, go to Bankruptcy Resources

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Legal Resource Center: United States Code TITLE 11 Filing Bankruptcy Forms Software