Chapter 11 Bankruptcy Converted to Chapter 7 for New York Home Remodeler

Written by CFB Blogger. Posted in Blog

Sherman Industry Inc., a Westbury home re-modeler that lost its licenses to operate on Long Island amid consumer complaints, filed for Chapter 11 bankruptcy in June. This month, a judge for the Central Islip, U.S. Bankruptcy Court ordered the company’s Chapter 11 bankruptcy be converted to that of a Chapter 7 bankruptcy, which would liquidate the business instead of reorganizing it and allowing it to resume operations. According to an article in Newsday by Tom Incantalupo, the Office of the United States Trustee asked the judge to either dismiss Chapter 11 bankruptcy or convert it to a Chapter 7 liquidation proceeding, in which the debtor’s nonexempt assets are sold by the trustee, with any proceeds distributed to creditors according to the priorities established in the bankruptcy code. The request said that company, which is no longer viable, “has failed to demonstrate to the court and the trustee that it has either the means or the desire to proceed toward a successful reorganization.” Homeowners complained to consumer affairs officials in Nassau and Suffolk counties as well as to Newsday, averring that the remodeling company would begin jobs and not complete them or do shoddy work.  They also stated that Sherman Industry misdirected hundreds of thousands of dollars in customer deposits and progress payments that should have been held in an escrow account. Nassau County had revoked the home remodeling company’s license when principles for the company did not appear for a June hearing on 10 consumer complaints. A county spokeswoman said that the county has 30 complaints and the matter has been referred to the office of the District Attorney, where an investigation is in progress. Suffolk County had received 16 complaints against the company and did not renew Sherman’s license when it expired in May. “This Chapter 7 decision was a good one, but it still leaves people suffering,” said one aggrieved homeowner. The Client First Bankruptcy attorneys are among the most knowledgeable consumer bankruptcy attorneys in the U.S., representing thousands of clients in Chapter 13 and Chapter 7 bankruptcy cases. Client First Bankruptcy attorneys answer their phones Monday thru Friday from 8:30 a.m. – 6:00 p.m. (Central Time) so you can get your initial complimentary consultation at a time that is convenient for you. Our aggressive representation and extensive experience have earned Client First Bankruptcy a national reputation for excellence in the representation of debtors in financial distress. Call us toll-free at 800-383-6004 and log onto our easy-to-navigate, interactive website at www.clientfirstbankruptcy.com for timely and vital information on filing your Chapter 13 or Chapter 7 bankruptcy.