Handling disputed debts

A disputed debt is a bona fide disagreement between the creditor and the committee as to the existence of a debt or the amount owed by the committee.

Until the creditor and committee resolve the dispute (assuming the creditor did provide something of value), the SSF must disclose:

• The amount the committee admits it owes;
  
• The amount the creditor claims is owed; and
  
• Any amounts the committee has paid the creditor.

Use Schedule D to report:

• The outstanding amount owed on a debt or obligation; and
  
• Payments made to reduce the debt.

Schedule D instructions explain what additional information is required. The SSF may note on its report that its disclosure of a disputed debt does not constitute an admission of liability or a waiver of any claims the SSF may have against the creditor.

Enter the Schedule D total of outstanding debts, plus the balance of loans owed by the committee (carried over from Schedule C) on Line 10 of the Summary Page. Note that payments to reduce debts must also be reported under the appropriate category of disbursement on the Detailed Summary Page (for example, Line 21(b) for a payment on a bill for an operating expenditure).