Bankruptcy

Has anyone ever had any of their philatelic material consigned to a dealer only to lose it by the dealer declaring bankruptcy? It happened to someone that I know.

Never have.
Should be able to get at least a portion of the value reimbursed. Should probably contact an attorney.

As it was on consignment, it was not the property of the dealer, so is not involved with the bankruptcy. The bankruptcy trustee will return it upon proof that it belonged to the collector and was on consignment only. If she/he doesn't return it, then contact a lawyer.

Jogil - what country? Bankruptcy laws are different in different countries. Has the material been auctioned? This is, is he trying to get back consigned material or the money the lots realized in the auction? If the material was already auctioned, the consignor is normally a general (unsecured) creditor of the bankrupt and gets only a pro-rata distribution. As stampcrow said, your friend needs to talk to bankruptcy attorney in the appropriate state / country.

Title of ownership is never transferred to the auction firm ,if it was sold ,then those funds should of been placed into a segregated account for the benefit of the consignor . But if funds were comingled with the firms fund then you got a criminal act .

That might depend on dollar amount and local laws...wouldn't it? Or is mixing the money that way criminal regardless?

As the dealer declared bankruptcy there's a very good chance that the philatelic material is gone (probably already sold off) or "missing". Recovery of funds outside the framework of the bankruptcy will be difficult and a lawyer should be consulted.

Your dealing with two different laws at the state level ,first being bankruptcy and the other laws governing funds held in trust ,for the consignors .

If the bankrupcy affects your stamps, it means that the stamps wasn't really yours, or at least, the dealer has any legal right on the stamps. Other possibility os that the dealer os trying to use your stamps, as if they were part of his stock. Do you have any consignment contract, so that you can prove that the stamps are yours?

jogil - You friend needs to contact the firm handling the bankruptcy ASAP. If there is a valid consignment contract, then their property is returned to them (hopefully without need of an attorney). If there is no contract, then the stamps in question would unfortunately be assumed to be property of the filer and subject to the settlement.

I am not a lawyer, but I've had a layman's crash course in both bankruptcy and estate law in the past nine months. Good luck.

There was a major militaria auction house go bankrupt while they held both consigned items and monies due to me for previously sold items. I provided proof of ownership for the unsold items, which were returned to me promptly and without cost. As for the items which were sold at auction prior to the bankruptcy, but for which I had not yet been compensated, that was considered as an indebtedness of the company and subject to the bankruptcy settlement. As an unsecured debtor, I got $116.00 of the $11,600 I was owed. The silver lining, albeit a very tarnished one is that is made for a decent tax loss.

Jogil,

how much value is involved,

Pagoda

Assuming we're talking about the U.S., bankruptcy law is federal and is therefore the same for all states. BlackJag is correct. Consigned property does not belong to the dealer who filed bankruptcy and should be returned by the trustee to the owner upon proper proof of the consignment.

While I have not been personally involved in a dealer bankruptcy, I do have knowledge of a few. Unless ironclad proof of the consignment status of an item exists it'll be considered as part of the unsecured creditor claims and the claimant will suffer a loss to some degree.

My friend lost a few thousand dollars worth of stamps from a dealer bankruptcy and it happened in Canada a few years ago.

You posters got this all wrong ........You go after the owners of the auction house for FRAUD and CRIMINAL intent . This is in state court at the local level . This will hold back any bankruptcy court until all criminal charges are settled . It would not be hard to show that the firm was
having problems before you consign the material and they willfully took your stamps for auction with the full knowledge they are having problems .
The owners are more concern with criminal charges than having some Judge assign this to a trustee .