Notice to Creditors
What it is:
The notice to creditors is a way to inform creditors of their opportunity to make claims against a bankrupt company, an estate or other entity.
How it works/Example:
Let's say Company XYZ files for bankruptcy. As part of the proceedings, the court publishes a notice to creditors in the local newspaper and one national paper, advising all creditors to appear in court on Monday, January 15, at 3 p.m. if they have claims to present against Company XYZ.
After January 15, these creditors then meet and organize their claims against Company XYZ. Creditors who miss the January 15 deadline are not allowed to make claims against Company XYZ.
Notices to creditors can be involved in personal bankruptcies, estate issues and other matters. Here is an example of one recently published in a Florida newspaper:
Why it matters:
A notice to creditors is a public notice advising the general public about when and where to appear if they have a claim on a certain estate.