Customer bankrupt? These 5 rights limit your damages

In the aftermath of a customer’s bankruptcy, creditors often wonder how to prevent being left empty-handed. Practice shows that obtaining money after bankruptcy is a challenge. Nevertheless, as a creditor, you can take proactive measures to strengthen your position and limit your damages. This news article sheds light on the legal options available to minimize damage.

Prevention is better than cure

As part of risk management, a strict credit policy forms the basis for minimizing financial risks. Knowing your business partners and avoiding prolonged payment delays are crucial. By obtaining our credit reports and arranging timely payment agreements, you can secure at least part of your claim.

Legal conditions in bankruptcy

In addition to preventive measures, there are legal options that contribute to limiting damage:

1. Retention rights and the right of reclamation

Retention rights allow you to retain a good until the customer has paid the amounts due.

The right of reclamation provides the option to reclaim goods if the invoice remains unpaid, with strict deadlines for reclamation.

2. Reservation of ownership

Always deliver products with a reservation of ownership, providing the possibility to reclaim delivered goods if invoices remain unpaid. Contractual agreements are essential in this regard.

3. Pledge and mortgage rights

Obtaining securities such as a pledge or mortgage rights provides protection. A pledge can, for example, be established on movable goods such as a car, granting selling rights.

4. Surety and personal guarantee

Surety by a third party ensures payment of invoices if the debtor defaults.

Company directors can personally guarantee invoice payments, providing an additional assurance.

5. Submitting your claim to the curator

In bankruptcy, it is crucial to submit your claim, with sufficient evidence, to the curator. This allows you to claim a portion of the available funds for creditors.

Reclaiming VAT from the tax authorities is possible with a statement from the curator confirming non-payment.

Legal advice is essential

The mentioned options provide creditors with more flexibility than often thought. Nevertheless, it is advisable to always seek legal advice from a specialist to be fully aware of rights and obligations. By taking proactive measures and considering legal steps, creditors can effectively manage their financial risks and minimize damage.