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Suppose a person made a batch of beer at a small brewery chain here in Boston and was scheduled to pick it up, when they find out the brewery has closed due to bankruptcy.

The person wants to file a claim in small claims court, as the brewery still has their $250 keg of beer. Is there a way to get ahold of the owner/rep to inform them of the case?

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  • Your local small claims court will have all the instructions and forms that you need, and possibly local law students or lawyers to help you file.
    – BlueDogRanch
    Nov 10, 2020 at 19:14
  • Don't necessarily expect a small claims court victory to get you your money, it might bump you up in the creditors list tho in the bankruptcy proceedings - a small claims court ruling doesnt necessarily overrule the bankruptcy proceedings.
    – user28517
    Nov 10, 2020 at 20:49
  • Depending on how far out of your way it is, it may be worth heading there in person.
    – Comic Sans Seraphim
    Nov 10, 2020 at 23:26
  • Is it the beer that costed $250 to order, or did they provide the brewery with their own beer kegs worth $250, which they now want back?
    – Dmitry Grigoryev
    Nov 17, 2020 at 13:34

2 Answers 2

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You can't sue in small claims court without bankruptcy court permission which is too expensive to seek permission to obtain to be worth it for you.

Any recovery is limited to filing a claim in the bankruptcy (on a simple one or two page claim form) and waiting to see if you get paid on it. They can contest it in an adversary proceeding, but for a $250 debt that is valid, they probably won't.

You should get a notice in the mail in the near future notifying you of the address and case number and deadline for filing your claim, if you won't in a couple of weeks, you should look it up on the Internet (do a PACER search on the firm name for the bankruptcy court that serves Boston).

Some reorganizations under Chapter 11 result in trade creditors like you getting paid 100 cents on the dollar.

In liquidations under Chapter 7, general creditors like you usually get only pennies on the dollars.

Don't do more business with them until they pay not only your new amounts owed in cash but also pay you in full for work previously provided and not paid for. This will encourage them to get an order authorizing them to pay you 100 cents on the dollar.

In the meantime, try to sell the beer to someone else to mitigate your damages and keep good records of what you are paid.

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You don’t need to sue

Simply file a proof of debt (which requires no proof other than you saying what you are owed and why) with the liquidator (who will be on record with the company registrar). And wait.

If there is a dividend payable to unsecured creditors (which can take several years and is usually very small <5c in the $ is typical) you will get your share.

Or, if this seems like too much work for what will probably be less than $5 in 3 years, forget about it.

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