734-359-7018
Now Accepting New Clients!
Blog

When Should a Restaurant File for Chapter 11 Bankruptcy?

A restaurant may struggle to stay open during COVID restrictions.Unfortunately, COVID-19 has resulted in many bankrupt restaurants. A lot of restaurants had to close their doors because of the pandemic and the social distancing regulations that were put in place. If your business has not been able to ride this storm, you’re not alone, and filing for Chapter 11 bankruptcy may be the right solution for your situation right now. 

With that in mind, read on for our guide to filing for bankruptcy as a restaurant owner.

The Impact that COVID-19 Has Had on the Restaurant Sector

Over the past year, a lot of bars and restaurants had to shut their doors because local governors ordered them to do so. While many of these establishments have been given permission to reopen, the unexpected and sudden revenue loss has had lasting effects. A lot of businesses have not been able to ride this storm, especially small family restaurants that need to be open every day. Rather than closing indefinitely, filing for Chapter 11 bankruptcy may be the best solution for those who want to keep their restaurant doors open.

What Happens When a Restaurant Files for Chapter 11 Bankruptcy?

A lot of business owners assume that filing for bankruptcy means they will need to close their business for good. This is not necessarily the case. Chapter 11 is a type of bankruptcy that involves debt restructuring, as opposed to your assets being liquidated. The latter is Chapter 7 bankruptcy. Because of this, you could be able to keep your restaurant doors open. Nevertheless, there are a number of different rules you will need to follow to keep control of your business.

What to Expect When Filing for Chapter 11 Bankruptcy

So, what will happen should you file for Chapter 11 bankruptcy? If you file for bankruptcy, you will typically be permitted 120 days so that you can put together a plan for reorganization. The steps that you take within this four-month period can have a significant impact on the future success of your food establishment.

If you are considering going down this route, one piece of advice that we would give you is to avoid waiting until you are insolvent to declare bankruptcy. If your business is in trouble at the moment, the sooner you act and get in touch with our legal team the better.

Contact Us Today if you Need Help with Chapter 11 Bankruptcy 

If your restaurant is going through a difficult period and you feel that Chapter 11 bankruptcy is a must, please do not hesitate to get in touch with our team at Aldrich Legal Services today. We have more than 21 years of experience in the industry, and our friendly and professional team is always happy to help. We look forward to hearing from you. 

PROBATE 42: Dissolution of professional corporation.

This case involves the estate of a doctor whose professional corporation also had to be dissolved upon his death. The personal representative of the estate sold the company’s assets but did not pay off the company’s debts before transferring the proceeds to the estate and distributing them to the heirs.

REAL ESTATE 73: Quiet title action.

This case involves a dispute over real property located in Michigan. W and V who are D’s parents, acquired the property. In 1999, W and V conveyed the property to the Trust, to which W is the sole trustee, via a quit claim deed. At some point...

How Is Alimony Determined In A Michigan Divorce?

Originally posted on 06/22/2018. When filing for divorce in Michigan, you may seek alimony, spousal support, from their spouse whenever they require financial aid. A judge may order your spouse to pay certain alimony. However, it depends...

Is My Conviction Eligible for Expungement?

Originally posted on 10/11/2019. At one point or another, we have all made mistakes. For some people, those mistakes involved breaking the law. Convictions have a large impact on someone’s life. Beyond the sentencing ranging from...

PROBATE 45: The court held that the probate court did not err by granting summary disposition for Plaintiff, or by denying Defendant’s request for an extension of the discovery period, adjournment of mediation, and issuance of subpoenas and by dismi

This case arises out of competing petitions for probate. On November 19, 2018, Defendant initiated this case by filing a petition for probate, attaching Decedent’s death certificate and purported last will and testament, dated March 9, 2007,...

DIVORCE 57: Holding that the trial court’s factual findings were not supported by the record evidence, and thus could not stand, the court reversed, vacated the portion of the Amended Default JOD ordering defendant to pay $3,325 to plaintiff, and re

Plaintiff first testified that she and defendant purchased the marital home in 1995. At the time the first default judgment of divorce was entered in September 2017, plaintiff had the home appraised. The value of the home was determined to be...

FAMILY LAW 68: The court held that the satisfaction of the statute relating to the termination of parental rights does not necessarily provide clear and convincing evidence in a parenting time dispute that a child will be harmed by reintroduction to

In a separate case, defendant’s parents filed a petition to terminate plaintiff’s parental rights and adopt RM on the ground that plaintiff had been absent from RM’s life for over three years. One month before the petition was...

FAMILY LAW 66: The court affirmed the trial court’s retroactive child support modification as to the second credit to which plaintiff-mother admitted at the referee hearing, and reversed and remanded as to the trial court’s equitable abatement of th

The parties have two children in common, and both children are now adults. The parties were never married, but plaintiff was granted custody and defendant was ordered to pay child support. After the youngest child turned eighteen, defendant sought a...

FAMILY LAW 65: The court held that because the ECE was not altered by the change of school districts, the referee properly applied the preponderance of the evidence standard when reviewing the best interest and parenting time factors.

BASIC FACTS The parties divorced in 2018. Their judgment of divorce provided that plaintiff would have primary physical custody and that the parties would have joint legal custody of the two minor children. The judgment of divorce stated that the...

FAMILY LAW 64: The court reversed the trial court’s order granting joint physical and legal custody of the parties’ children to defendant-father, concluding that the trial court improperly conflated his motion to change custody with plaintiff-mother

The parties divorced in 2013. The judgment of divorce granted mother sole physical and legal custody and ordered that the child’s domicile would remain in Michigan. In 2015, the trial court granted mother’s motion to change domicile,...

5 Common Misdemeanors Affecting People in Michigan

Originally posted on 11/08/2019 There are many different levels of crime and the consequences once someone has been charged with them. One bracket of crimes is known as a misdemeanor. Let’s go over this level of crime and some common...

PROBATE 44: The court held that the probate court did not err by declaring a will executed by the decedent invalid on the basis that she lacked testamentary capacity to execute it and that it was the product of petitioner’s undue influence.

Defendant and Decedent met in August 2017. In approximately November 2017, Decedent began talking constantly about wanting Defendant to take her to see an attorney for the purpose of changing her will. On March 19, 2018, Defendant filed a petition...

Michigan Expungement Law Updates For 2021

There has been a new law regarding expungements for the state of Michigan.  Gov. Gretchen Whitmer signed legislation that expands the criteria for expungements related to traffic offenses, marijuana convictions, and minor...

Wills and Trusts

Originally posted on: 02/14/2014 Aldrich Legal Service provides legal advice and representation for residents in Plymouth, Ann Arbor, and Southeast Michigan. We also review recent legal cases to examine what took place and what we can...

REAL ESTATE 68: Holding that plaintiffs-buyers’ allegations of fraud in this case arising from the sale of a residence did not preclude the trial court from granting defendants’ motion for summary disposition based on a release, the court affirmed.

This cause of action arises from plaintiffs’ purchase of a residence from defendant, who had rights in the house under a land contract from co-defendant, the legal owner of the house. Before the house was for sale, in January 2018, an upstairs...

Don't let a bad decision, unfair contract, or a messy divorce get in the way of a promising future!
Contact the experienced team at Aldrich Legal Services today to schedule your free initial
consultation
and secure reliable and trustworthy representation today!
Get the Help You Need From a Team You Can Truly Count On: (734) 404-3000
734-237-6482
734-366-4405