Browse terms
The bankruptcy process
Turnover
In bankruptcy, turnover is the duty to hand property of the bankruptcy estate, or its value, over to the trustee, and a turnover order is the court's order enforcing it. The duty applies to anyone who holds such property during the case, not only to the debtor. 1 2 3
Talk to a lawyerHow does a turnover order work in bankruptcy?
The bankruptcy estate includes all property in which the debtor has an interest, even if it is owned or held by another person. 4
An entity that has possession, custody or control of property the trustee may use, sell or lease, or of property the debtor may exempt, must deliver it to the trustee and account for it. There is an exception for property of inconsequential value or benefit to the estate. 1
Debts owed to the debtor are covered too. An entity that owes a matured debt that is property of the estate must pay it to the trustee, except to the extent the debt may be offset against a claim against the debtor. 1
The debtor has a matching duty: to cooperate with the trustee and to surrender all property of the estate and any recorded information about it, including books, documents, records and papers. 2
How the trustee asks depends on who has the property. Under the bankruptcy rules, a proceeding to make the debtor deliver property to the trustee is not an adversary proceeding. A proceeding to recover money or property from someone else generally is one, which means a separate lawsuit started by a complaint inside the case. 3 4
Common questions
What does a motion for turnover mean?
It is a request for the court to order property delivered to the trustee. When the debtor has the property, the request is not an adversary proceeding. To recover money or property from someone else, the trustee generally has to bring an adversary proceeding. 3
What if someone paid me directly without knowing about the bankruptcy?
An entity with neither actual notice nor actual knowledge of the case may, in good faith, pay a debt owed to the debtor to someone other than the trustee, with the same effect for that entity as if the case had not been filed. 1
Can the trustee get records from my accountant or lawyer?
After notice and a hearing, and subject to any applicable privilege, the court may order an attorney, accountant or other person holding recorded information about the debtor's property or financial affairs to turn it over or disclose it to the trustee. 1
Sources
Asked by the trustee to hand something over?
A bankruptcy lawyer in your state can explain what you must deliver and what you may keep.
Connect to a bankruptcy lawyer