Chicago Bankruptcy Law Blog

An Illinois playhouse has been forced to close its doors due to the effects of the recent economic downturn, according to local news sources. The Illinois Theatre Center, located in Park Forest, had been in operation for 36 years. The governing body for the theater decided to file Chapter 7 bankruptcy because the facility was unable to keep up on its payments, a choice that has caused the theater to close its doors.

Many of the group's financial woes began when a leadership change that occurred earlier this year, after the theater director and co-founder unexpectedly died. The woman's son assumed her role as artistic director, but he said that without his mother, theater operations would not be the same.

Bankruptcy rates throughout the nation have remained sky-high as a result of the economic downturn, but local experts say that northern Illinois residents have seen a continued decline in their rates, contrary to the national trend. Experts are debating about the cause of the lower incidence of personal bankruptcy in the region, but they all agree that it ultimately spells good news for Chicago residents.

Some experts say that a more robust economy, lower mortgage rates and more stringent borrowing controls have reversed the national trend in the Chicago area. Others contend that personal bankruptcy claims may be dropping simply because of timing. Most people put off filing bankruptcy paperwork until tax season is nearly done. January, February and March are traditionally the slowest months for bankruptcy attorneys, some say, and the recent numbers are likely a reflection of that trend.

Recent economic strains have negatively impacted business owners and their employees throughout Illinois and other Midwestern states. A prominent businessman from the Midwest has declared Chapter 7 bankruptcy, a shocking move that is likely a harbinger of further economic trials in the region.

The man created his business group more than 30 years ago when he bought a Burger King franchise. Since that time, the group has sold the Burger King, but has acquired assets throughout the restaurant and service industries. The business has holdings in Macaroni Grill, San Francisco Oven and Fog City Coffee. The group actually purchased the entire San Francisco Oven chain, which has locations throughout the nation. The bankruptcy proceedings could affect all of the franchises owned by the man's organization.

Federal laws regarding bankruptcy are very complex in nature. A recent U.S. Court of Appeals decision confirms that the intricacies of each unique bankruptcy case are too convoluted for most Chicago, Illinois, families to navigate alone. The court dealt with a topic that has generated a lot of discussion: banning fee-only bankruptcies. This case came as a result of situations in which clients and their attorneys arranged to file Chapter 13 bankruptcy when they were low on funds at the beginning of proceedings. As a result, the attorney's fee would become the primary portion of bankruptcy payments.

The appeals court determined that fee-only bankruptcies are beneficial for those filing bankruptcy in most cases, because the attorney benefits the most from repayment. However, the majority opinion of the court stipulated fee-only Chapter 13 plans are suitable in some circumstances, and should be considered on a case-by-case basis. This ruling will not cause widespread fee-only filings, but will leave it as an option for cases that warrant its use.