An adverse governmental ruling in New Jersey can, believe it or not, put businesses at risk financially. This exact scenario has been playing out in Lebanon Township over the last few years. The Township’s First Aid Squad has been battling with the local government over a variety of issues for several years. In July of 2010, the Township voted to declare the local fire department as the first responder for medical emergencies. The 3-2 vote effectively undercut the First Aid Squad, and eventually led it to a Chapter 7 filing.
Following the governmental action, the First Aid Squad sued the township. The judge hearing the case instructed the parties to try and resolve their problems through mediation. However, the efforts were unsuccessful, with each accusing the other of delay and interference. Each side indicated its desire to reach a settlement, but when one could not be realized, the First Aid Squad had little choice but to file for Chapter 7 bankruptcy protection.
The issues in the bankruptcy are now said to be near resolution, and the township recently met in executive session to consider a settlement. The attorney for the township indicated that bankruptcy issues are complex and often limit the options available to the trustee administering the petition. However, the details of any issues involving the township were not disclosed.
A Chapter 7 petition results in a liquidation of assets, with any monies accumulated used to pay off some of the existing debt. In this situation, some of the First Aid Squad members have now joined the fire department, where they will presumably perform the same duties they performed as members of the First Aid Squad. However, the specter of outstanding debt will be removed, and presumably the community will receive the same or better service without the lingering wounds created by the public dispute. In New Jersey, individuals or businesses facing mounting debt and diminishing income may benefit from consulting an attorney devoted to helping confront those problems in an effort to wipe the financial slate clean.
Source: NJ, “Lebanon Township First Aid Squad nears end of bankruptcy case,” Lillian Shupe, Sept. 9, 2011