Chapter 15, Problem 2BS

(a)

Summary Introduction

Case summary: Person B has been a rancher all her life. Her ranch is valued at $\text{\$}$500,000. Person B has total 8 creditors and an indebtedness of $\text{\$}$70,000. Among all the creditors two of the largest creditors are person O with a debt of $\text{\$}$30,000 and person S with a debt of $\text{\$}$25,000. The rest of the six creditors have a claim of less than $\text{\$}$5,000. The drought has ruined all crops of person B. B cannot pay off her creditors.

To find: The validity of a voluntary petition of the bankruptcy of person B with a $\text{\$}$500,000 ranch.

(b)

Summary Introduction

Case summary: Person B has been a rancher all her life. Her ranch is valued at $\text{\$}$500,000. Person B has total 8 creditors and an indebtedness of $\text{\$}$70,000. Among all the creditors two of the largest creditors are person O with a debt of $\text{\$}$30,000 and person S with a debt of $\text{\$}$25,000. The rest of the six creditors have a claim of less than $\text{\$}$5,000. The drought has ruined all crops of person B. B cannot pay off her creditors.

To find: The validity of involuntary bankruptcy petition because of the force of person O or person S.