Chapter 50

COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 1CHAPTER 50 INSOLVENCY LAW Article 1. General Provisions. Article 2. Suspension of Payments. Article 3. Voluntary Insolvency. Article 4. Involuntary Insolvency. Article 5. Assignees. Article 6. Classification and Preference of Creditors. Article 7. Partnerships and Corporations. Article 8. Proof of Debts. Article 9. Compositions. Article 10. Discharge. Article 11. Fraudulent Preferences and Transfers. Article 12. Miscellaneous. ARTICLE 1 GENERAL PROVI SIONS § 50000. Insolvency Law, Defined. § 50001. Jurisdiction of Superior Court. § 50000. Insolvency Law, Defined. The provi sions of this Part shall be known and may he cited as The Insolvency Law and in accordance with its provisions every insolvent debtor maybepermitted to suspend payments or be dis charged from his debt and liabilities. SOURCE: CCP 1280. This entire part was enacted in 1953. Therefore, all references to the source herein will refer to the original enactment unless there has been a later amendment. COMMENT : Tothe best of the Compiler's knowledge, as of March, 1990 no debtor has used this part since at least 1970.

ein will refer to the original enactment unless there has been a later amendment. COMMENT : Tothe best of the Compiler's knowledge, as of March, 1990 no debtor has used this part since at least 1970. Rather, debtors seeking protection, or forced i nto it by creditors, have used the federal Bank ruptcy Law, enforceable through the District Court of Guam. However, the federal Bankruptcy laws do recognize certain local exemptions, which may be found in this Chapter and elsewhere in this Title. § 50001. Jurisdiction of Superior Court. The Superior Court shall have original jurisdiction in hearing and determining all causes, actions, and proceedings under this Part. COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 2SOURCE: CCP § 1281.Superior Court inserted in place of Island Court pursuant to P.L. 12 -85 and Partin place of Titleto conform to the arrangement of this Title of the Guam Code Anno tated. ---------- ARTICLE 2 SUSPENSION OF PAYMENTS § 50050. State of Suspension of Payments. Petition. Inventory to be Filed. § 50051. Order for Meeting of Creditors. Injunction to be Issued to Debtor . § 50052. Fees Deposited for Filing Petition; Not ice to Creditors. § 50053.

of Payments. Petition. Inventory to be Filed. § 50051. Order for Meeting of Creditors. Injunction to be Issued to Debtor . § 50052. Fees Deposited for Filing Petition; Not ice to Creditors. § 50053. Suspension of Execution Against Debtor . § 50054. Creditors Represented by Lawyers. § 50055. Meeting of Creditors. § 50056. Claimants Exempt. Agreement. § 50057. Agreements Rejected. § 50058. Agreements Made Effective. § 500 59.Objections to Meetings of Creditors. § 50060. Failure of Debtor to Perform. § 50050. S tate of Suspension of Payments. Petition. Inventory to be Filed. Any debtor who, possessing suffi cient property to cover all his debts, be it an individual person, an associ ation, or corporation, foresees the impossi bility of meeting them when they respectively fall due, may pe tition that he be declared by the court in the state of suspension of payments. The debtor shall annex to his petition a schedule and invent ory as set forth in § 50101, § 50102, and § 50103 of this Part, in addition to the statement of his assets and liabilities and the proposed agreement he requests of his creditors. SOURCE: CCP § 1285. § 50051. Order for Meeting of Creditors.

§ 50103 of this Part, in addition to the statement of his assets and liabilities and the proposed agreement he requests of his creditors. SOURCE: CCP § 1285. § 50051. Order for Meeting of Creditors. Injunction to be Issued to Debtor . Upon receiv ing and filing the petition with the schedule and documents mentioned in the next preceding section, the court shall make an order calling a meeting of creditors to take place in not less than two (2) weeks COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 3nor more than three (3) months from the date of such order. This order shall designate the day , hour , and place of meeting of the creditors. The order shall be published by the means authorized for the publication of service and notices and for such periods as may be pr escribed by the court. It shall contain an injunction forbid ding the peti tioning debtor from disposing of his property in any manner, except insofar as concerns the ordinary operations of commerce or of the indus tryin which the petitioner is engaged, and, further , from making any payments outside the necessary or legitimate expenses of his business or industry , so long as the proceedings relative to the

us tryin which the petitioner is engaged, and, further , from making any payments outside the necessary or legitimate expenses of his business or industry , so long as the proceedings relative to the suspension of payments are pending. For the purpos esof this law said proceedings shall be consider ed to have been instituted from the date of the filing of the petition. SOURCE: CCP § 1286. § 50052. Fees Deposited for Filing Petition; Notice to Creditors. A copy of said order shall immediately be published by the clerk of the court, in the manner de signat ed therein, for the number of times and in the form prescribed by the court, and the clerk shall cause a copy of said order to be delivered personally or to be sent forthwith by registered mail, postage pre paid, to all creditors named in the schedu le. There shall be deposited with the clerk of the court the sum of ten dollars ($10.00), which shall be paid to the Guam treasury for the filing and registration of the petition, including all proceedings until the legal process is completed, and, in addi tion, a sum sufficient to defray all expenses of publication ordered by the court, necessary postage and ten cents ($0.10) for each

all proceedings until the legal process is completed, and, in addi tion, a sum sufficient to defray all expenses of publication ordered by the court, necessary postage and ten cents ($0.10) for each copy , to be delivered personally or mailed to the creditors. The last -named sum is hereby consti tuted the legal fee for the personal delivery or mailing required bythis section. SOURCE: CCP § 1287. § 50053. Suspension of Execution Against Debtor . If any execution be pending against the debtor it shall not be consolidated with this proceeding, but the course thereof shall b e suspended before sale of property is made thereun der, provided the debtor makes a request therefor to the court before which the proceed ing for suspension of payments is pending, unless the execution be against property espe cially mortgaged which is h ereby exempted from the provisions of this section. The suspension ordered by virtue of this section shall lapse when three (3) months shall have passed without the proposed agreement being accepted COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 4bythe creditor or as soon as it is denied.

section shall lapse when three (3) months shall have passed without the proposed agreement being accepted COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 4bythe creditor or as soon as it is denied. No creditor o ther than those mentioned in § 50056 shall sue or institute proceedings to collect his claim from the debtor from the moment that suspension of payments is applied for and while the proceed ings are pending. SOURCE: CCP § 1288. § 50054. Creditors Represe nted by Lawyers. Creditors may be represented at the meeting by one or more lawyers, or by any person duly authorized by power of attorney , which document shall be presented and be attached to the record. Persons appearing for more than one creditor shall have only one personal vote, but the claims presented by them shall be taken into conside r- ation for the purpose of arriving at the majority of the amount represented SOURCE: CCP § 1289. § 50055. Meeting of Creditors. Only creditors included in the sch edule filed by the debtor shall be cited to appear and take part in the meeting mentioned in § 50051, and they shall be notified upon delivery or transmission to them of a copy of the order calling the meeting, to

the debtor shall be cited to appear and take part in the meeting mentioned in § 50051, and they shall be notified upon delivery or transmission to them of a copy of the order calling the meeting, to appear at the meeting with the written evidences of their respective claims, without which they shall not be admitted. The presence of the creditors representing at least three -fifths (3/5) of the liabilities shall be necessary for holding a meeting. The meeting shall be held on the day and at the hour and place designated, the judge of the Superior Court acting as president, and the clerk of the court as secretary thereof, subject to the follow ing rules: (a) The clerk shall prepare for insertion in the minutes of the meeting a statement of the pe rsons present and their claims; the judge shall examine the written evidences of the claims and the powers of attorney , if any . If the persons present who have com plied with the foregoing rules represent at least three -fifths (3/5) of the liabilities, the judge shall declare the meeting open for business. (b) The petition of the debtor , the sched ule of debts and of property , the statement of assets and liabilities, and the proposed

liabilities, the judge shall declare the meeting open for business. (b) The petition of the debtor , the sched ule of debts and of property , the statement of assets and liabilities, and the proposed agreement filed therewith shall be read forth with by the clerk, and the discussion shall he opened.COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 5(c) The debtor may modify his proposition or propositions in view of the results of the debate, or insist upon the ones already made, and the judge without further discussion shall clearly and succinctly place these several propo sitions before the meeting for a vote thereupon. (d) The vote shall be taken by a call of names and shall be inserted in the minutes; a majority vote shall rule. (e) To form a majority it is necessary: (1) That two -thirds (2/3) of the credi tors voting uni teupon the same proposition; (2) That the claims represented by said majori tyvote amount to at least three -fifths (3/5) of the total liabilities of the debtor mentioned in the petition. (f) After the result of the voting has been an nounced, all protest s made against the majority vote shall be admitted and stated in the record, and the meeting shall be

or mentioned in the petition. (f) After the result of the voting has been an nounced, all protest s made against the majority vote shall be admitted and stated in the record, and the meeting shall be closed. (g) The minutes of the meeting, containing a succinc t statement of all proceedings had therein, shall he drawn up, and there shall be inserted the rein, the proposition or propo sitions voted upon, which, after having been read and approved, shall be signed by the judge together with all persons taking part in the voting. If any such persons shall be unable to write, any person present shall sign, at their request, and the clerk shall certify to all of the above. SOURCE: CCP § 1290. § 50056. Claimants Exempt. Persons having claims for personal labor, maintenance, expenses of last illness and funeral, of the wife or chil dren of the debtor, incurred in the sixty (60) days immediately preceding the filing of the petition, and the persons having legal or con tractual mortgages, may refrain from attending the meeting and from voting therein. Such persons shall not be bound by any agreement determined up on at such meeting, but if they should join in the voting they shall be bound

efrain from attending the meeting and from voting therein. Such persons shall not be bound by any agreement determined up on at such meeting, but if they should join in the voting they shall be bound in the same manner as are the other creditors. SOURCE: CCP § 1291. § 50057. Agreements Rejected. The proposed agreement shall be deemed rejected if the number of creditors req uired for holding a meeting does not voluntarily attend thereat, COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 6or if the two majorities mentioned in § 50055(e) are not in favor thereof, even if the negative vote itself does not receive such majority . SOURCE: CCP § 1292. § 50058. Agreements Made Effe ctive. If the decision of the meeting be negative as regards the proposed agreement or if no decision is had in default of such number or of such majorities, the proceedings shall be terminated without recourse and the parties concerned shall be at libert y to enforce the rights which may corre - spond to them. If the decision is favorable to the debtor, it may be objected to within ten (10) days following the date of the meeting by any creditor who attended the meeting, and who dissented from and prote sted a

the decision is favorable to the debtor, it may be objected to within ten (10) days following the date of the meeting by any creditor who attended the meeting, and who dissented from and prote sted a gainst the vote of the majority . The opposition or objection to the decision of the majority favorable to the debtor shall be proceeded with as in any other incidental motion, the debtor and the creditors who shall appear declaring their purpose to sustain the decision of the meeting being the defendants. The court shall hear and pass upon such objection as soon as possible and in a summary manner , and in its order, which shall be final, it shall declare whether or not the decision of the meeting is valid. In case that the decision of the meeting is held to be null, the court shall declare the proceeding terminated and the parties concerned at liberty to exercise the rights which may correspond to them; and in case the decision of the meeting is declared val id, or when no opposition or objection to said decision has been presented, the court shall order that the agree ment be carried out and the persons concerned shall be bound by the decision of the meeting.

when no opposition or objection to said decision has been presented, the court shall order that the agree ment be carried out and the persons concerned shall be bound by the decision of the meeting. The court may issue all orders which may be proper to enforce the agreement on motion of any of the parties litigant. The order directing the agreement to be made effective shall be binding upon all creditors included in the sched ule of the debtor who may have been properly summoned, but not upon credito rs mentioned in § 50056 who failed to attend the meeting or re frained from voting therein, and their rights shall not be affected by the agree ment unless they may have expressly or impliedly consent ed thereto. SOURCE: CCP § 1293. § 50059. Objections t o Meetings of Creditors. The causes for which objection may be made to the decision of the meeting shall be:COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 7(a) Defects in the call for the meeting, in the holding thereof, and in the deliberations had thereat which prejudice the rights of the creditors; (b) Fraudulent connivance between one or more creditors and the debtor to vote in favor of the pro posed agreement; (c) Fraudulent

liberations had thereat which prejudice the rights of the creditors; (b) Fraudulent connivance between one or more creditors and the debtor to vote in favor of the pro posed agreement; (c) Fraudulent conveyance of claims for the pur pose of obtaining a majority . SOURCE: CCP § 1294. § 50060. Failure of Debtor to Perform A greement. If the debtor fails wholly or in part to perform the agreement decided upon at the meeting of the creditors, all the rights which the creditors had against the debtor before the agreement shall revest in them. In such case the debtor may be mad e subject to the bankruptcy and insolvency proceed - ings in the manner estab lished by the following Chapters of this Title. SOURCE: CCP § 1295. ---------- ARTICLE 3 VOLUNT ARY INSOL VENCY § 50100. Petition for V oluntary Insolvency . § 50101. Schedule, Wh at to Include. § 50102. Inventory , What to Include. § 50103. Affidavit of Petitioner . § 50104. Order of Court; Appointment of a Receiver . § 50105. Publication of Court Order . § 50100. Petition for V oluntary Insolvency. An insol vent debtor, owing de bts exceeding in amount the sum of One Thousand Dollars ($1,000.00), may apply to be dis charged from his

of Court Order . § 50100. Petition for V oluntary Insolvency. An insol vent debtor, owing de bts exceeding in amount the sum of One Thousand Dollars ($1,000.00), may apply to be dis charged from his debts and liabilities by petition to the Supe rior Court, Guam. In his petition he shall set forth his place of residence, the period of his residence therein immediately prior to filing said petition, his inability to pay all his debts in full, his willingness to surrender all his proper ty, estate, and effects not exempt from execu tion for the benefit of his creditors, and an application to be adjudg ed an insolvent. He shall annex to his petition a schedule and COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 8inventory in the form hereinafter provided. The filing of such petition shall be an act of insolvency. SOURCE: CCP § 1300. § 50101. Schedule, What to Include. Said schedule must contain a fu ll and true statement of all his debts and liabilities, together with a list of all those to whom, to the best of his knowledge and belief, said debts or liabilities are due, the places of residence of his creditors and the sum due each, the nature of the indebted - ness or liability

hose to whom, to the best of his knowledge and belief, said debts or liabilities are due, the places of residence of his creditors and the sum due each, the nature of the indebted - ness or liability and whether founded on written security , obligation, contract or otherwise, the true cause and consideration thereof, the time and place when and where such indebtedness or liability accrued, a declaration of any existing pledge, lien, mortgage, judgment, or other security for the payment of the debt or liability , and an outline of the facts giving rise or which might give rise to a cause of action against such insolvent debtor . SOURCE: CCP § 1301. § 50102. Inventory, What to In clude. The inventory must contain, besides the creditors, an accurate description of all the real and per sonal property , estate, and effects of the petitioner , including his homestead, if any , together with a statement of the value of each item of said property , estate, and effects and its loca tion, and a statement of the encumbrances thereon. All property exempt by law from execution shall be set out in said inventory with a state ment of its valuation, location, and the encumbrances thereon, if any

statement of the encumbrances thereon. All property exempt by law from execution shall be set out in said inventory with a state ment of its valuation, location, and the encumbrances thereon, if any . The inventory shall contain an outline of the facts giving rise, or which might give rise, to a right of action in favor of the insolvent debtor . SOURCE: CCP § 1302. § 50103. Affidavit of Petitioner . The petition, schedule, and inventory must be verified by the affidavit of the petitioner, annexed thereto, and shall be in form substan tially as follows: 'I, ____________________, do solemnly swear that the schedule and inventory now delivered by me contain a full, correct, and true discovery of all my debt s and liabilities and of all goods, effects, estate, and property of whatever kind or class to me in any way belonging. The inventory also contains a full, true, and correct statement of all debts owing or due me, or to any person COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 9or persons in trust for m e and of all securities and con tracts whereby any money may hereafter become due or payable to me or by or through which any benefit or advantage whatever may accrue to me or

persons in trust for m e and of all securities and con tracts whereby any money may hereafter become due or payable to me or by or through which any benefit or advantage whatever may accrue to me or to my use, or to any other person or persons in trust for me. The schedule conta ins a clear outline of the facts giving rise, or which might give rise, to any cause of action in my favor. I have no lands, money , stock, or estate, reversion, or expectancy , or property of any kind, except that set forth in said inventory . I have in no i nstance created or acknowledged a debt for a greater sum than I honestly and truly owe I have not, directly or indirectly , concealed, fraudulently sold, or otherwise fraudulently disposed of any part of my real or personal property , estate, effect, or righ ts of action, and I have not in any way compounded with any of my creditors in order to secure such creditors, or to receive or to accept any profit or advantage therefrom, or to defraud or deceive in any matter any creditor to whom I am indebted. So help me God.' SOURCE: CCP § 1303. § 50104. Order of Court; Appointment of a Receiver .

any profit or advantage therefrom, or to defraud or deceive in any matter any creditor to whom I am indebted. So help me God.' SOURCE: CCP § 1303. § 50104. Order of Court; Appointment of a Receiver . Upon receiving and filing said peti tion, schedule, and inventory , the court shall make an order declaring the petitioner insolvent, and directing a commissioner of a distr ict to take possession of, and safely keep, until the appointment of a receiver or assignee, all the deeds, vouchers, books of account, papers, notes, bonds, bills, and securities of the debt or, and all his real and personal property , estate, and effects , except such as may be by law exempt from execution. Said order shall further forbid the payment to the debtor of any debts due to him and the delivery to the debtor, or to any person for him, of any property belonging to him, and the transfer of any propertyby him, and shall further appoint a time and place for a meeting of the creditors to choose an assignee of the estate. The order shall be published in the manner and form used in Guam for such times and periods as the court may prescribe.

e and place for a meeting of the creditors to choose an assignee of the estate. The order shall be published in the manner and form used in Guam for such times and periods as the court may prescribe. The time ap pointed for the election of an assignee shall not be less than two (2) weeks, nor more than three (3) months, from the date of the order of adjudication. Upon the granting of the order , all civil proceedings pending against the said insolvent shall be stayed. When a receiver is appointed, or an assignee chosen, as provided by this Title, the commissioner shall there -upon deliver to such receiver or assignee, as the case may be, all the property , assets, and belongings of the COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 10insol vent which have come into his possession, and he shall be allowed and paid as compensa tion for his services the same expenses and fees as would bylaw be collectible if the property had been levied upon and safely kept under attachment. SOURCE: CCP § 1304. § 50105. Publication of Court Order . A copy of the court's order shall immediately be pub lished by the cle rk of said court, for the num ber of times and for such periods as prescribed by

P § 1304. § 50105. Publication of Court Order . A copy of the court's order shall immediately be pub lished by the cle rk of said court, for the num ber of times and for such periods as prescribed by the court. A copy of said order shall be delivered personally or sent by the clerk forth with by registered mail, postage prepaid, to all creditors named in the schedule. There shall be deposited with the clerk of the court the sum of ten dollars ($10.00), which shall be paid into the Guam treasury on commencing such proceedings and, in addit ion, a sum of money sufficient to defray the expense of the publication ordered by the court, necessary postage, and ten cents ($0.10) for each copy , to be delivered personally or mailed to the creditors. The last -named sum is hereby constituted the legal fee for the per sonal delivery or mailing required by this section. SOURCE: CCP § 1305. ---------- ARTICLE 4 INVOLUNT ARY INSOL VENCY § 50150. Acts of Insolvency , What Constitute. § 50151. Undertaking Required. § 50152. Court Order for Hearing. § 5015 3.Service Upon Debtor . § 50154. Defendant to File Motions or Answer. § 50155. Court Order , What to Include.

What Constitute. § 50151. Undertaking Required. § 50152. Court Order for Hearing. § 5015 3.Service Upon Debtor . § 50154. Defendant to File Motions or Answer. § 50155. Court Order , What to Include. Stay of Proceedings Against Debtor . Appointment of an Assignee or Receiver . § 50156. Publication of Court Order . § 50157. Court Order: When Deb tor Resides Out of Guam; Undertaking Required. § 50158. Bonds, Conditions; Exceptions. § 50159. Sale of Property; Deposit of Proceeds.COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 11§ 50150. Acts of Insolvency, What Constitute. An adjudication of insolvency may be made on the petition of two or more creditors, and the amount of which credits or demands are in the aggregate not less than one thousand dollars ($1,000.00); provided, that none of said credi tors has become a creditor by assignment, however made, within thirty (30) days prior to the filin g of said petition. Such petition must be filed in the Superior Court. The following shall be considered acts of insolvency , and the peti tion for insolvency shall set forth one or more of such acts: 1.

said petition. Such petition must be filed in the Superior Court. The following shall be considered acts of insolvency , and the peti tion for insolvency shall set forth one or more of such acts: 1. That such person is about to depart or has departed f romGuam, with intent to defraud his creditors; 2. That being absent from Guam, with intent to defraud his creditors, he remains absent; 3. That he conceals himself to avoid the service of legal process for the purpose of hindering or delaying or defraudin g his creditors; 4. That he conceals, or is removing, any of His property to avoid its being attached or taken on legal process; 5. That he has suffered his property to remain under attachment or legal process for three (3) days for the purpose of hinderin g or delaying or defrauding his creditors; 6. That he has confessed or offered to allow judgment in favor of any creditor or claimant for the purpose of hindering or delaying or defrauding any creditor or claimant; 7. That he has willfully suffered judgmen t to be taken against him bydefault for the purpose of hinder ing or delaying or defraud ing his creditors; 8.

laying or defrauding any creditor or claimant; 7. That he has willfully suffered judgmen t to be taken against him bydefault for the purpose of hinder ing or delaying or defraud ing his creditors; 8. That he has suffered or procured his property to be taken on legal process with intent to give a prefer ence to one or more of his creditors; 9.That he has made any assignment, gift, sale, conveyance, or transfer of his estate, property , rights, or credits with intent to delay , defraud, or hinder his creditors; 10. That he has, in contemplation of insol vency , made any payment, gift, grant, sale, conveyance, or transfer of his estate, prop - erty, rights, or credits;COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 1211. That being a merchant or tradesman he has generally defaulted in the payment of his current obligations for a period of thirty (30) days; 12. That for a period of thirty (30) days h e has failed, after demand, to pay any moneys deposited with him or received by him in a fiduciary capacity; and, 13. That an execution having been issued against him on final judgment for money , he shall have been found to be without sufficient property s ubject to execution to

im in a fiduciary capacity; and, 13. That an execution having been issued against him on final judgment for money , he shall have been found to be without sufficient property s ubject to execution to satisfy the judgment. The petitioner may, from time to time, by leave of the court, amend and correct the petition, so that the same shall conform to the facts, such amendments to relate back to and be received as embraced in the ori ginal petition. SOURCE: CCP § 1310. § 50151. Undertaking Required. The said petition shall be accompanied by an undertaking, approved bythe court, with at least two (2) sureties, in such penal sum as the court shall direct, conditioned that if the peti tion in insol vency be dismissed by the court, or withdrawn by the petitioner , or if the debtor shall not be declared insolvent, the petitioners will pay to the debtor alleged in the petition to be insol vent, all costs, expenses, and damages occa sioned b y the proceedings in insolvency , together with a reason able counsel fee to be fixed by the court. The court may , upon motion, direct the filing of an additional bond, with different sureties, when deemed necessary . SOURCE: CCP § 1310a. § 50152.

reason able counsel fee to be fixed by the court. The court may , upon motion, direct the filing of an additional bond, with different sureties, when deemed necessary . SOURCE: CCP § 1310a. § 50152. Court Or der for Hearing. Upon the filing of such creditors' petition, the court shall issue an order requiring such debtor to show cause, at a time and place to be fixed by said court, why he should not be adjudged an insol vent debtor; and at the same time, or t hereaf ter, upon good cause shown therefor, said court m ay make an order forbidding the payment of any debts, and the delivery of any property belonging to such debtor to him or to any other person for his use or benefit or the transfer of any property by him. SOURCE: CCP § 1311. § 50153. Service Upon Debtor . A copy of the petition, with a copy of the order to show cause, shall be served on the debtor' in the same manner as is provided by law for the COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 13service of summons in civil actions, but such service shall be made at least five (5) days before the time fixed for the hearing; provided, that if, for any reason, the service is not made, the order may be renewed, and the

vil actions, but such service shall be made at least five (5) days before the time fixed for the hearing; provided, that if, for any reason, the service is not made, the order may be renewed, and the time and place of hearing changed by supplemental order of the court. Whenever the debtor on whom service is to be made resides out of Guam; or has departed from Guam; or cannot after due diligence be found within Guam; or conceals himself to avoid the service of the order to show cause, or any other process or orders in the matter; or is a foreign corporation having no managing or business agent, cashier, or secre tarywithin Guam upon whom service can be made and such facts are shown to the court by affidavit, such court shall make an order that the service of such order , or other process, be made by publication, in the same manner , and with the same effect, as service of summons by publication in ordinary civil actions. SOURCE: CCP § 1312. § 50154. Defendant to File Motions or Answer . At the time fixed for the hearing of said order to s how cause, or at another time to which such hearing may be adjourned, the debtor must answer the petition, or may file motions do dismiss for the

At the time fixed for the hearing of said order to s how cause, or at another time to which such hearing may be adjourned, the debtor must answer the petition, or may file motions do dismiss for the same causes as are provided for such motions as in other proceedings. If the motion is overruled, the debtor s hall immediately answer the petition. Such answer shall contain a specific denial of the material allegations of the petition controverted by him, and shall be sworn to; and the issues raised thereon shall be promptly tried and disposed of. If, upon such t rial, the issues are found in favor of the re spondent, the proceedings shall be dismissed, and the respondent shall be allowed all costs, counsel fees, expenses, and damages sustained by reason of the proceedings therein. Counsel fees, costs, expenses, an d damages shall be fixed and allowed by the court. SOURCE: CCP § 1313. Reference to demurrers changed to motions to dismiss since demurrers have been abolished by the Guam Rules of Civil Procedure, Rule 7(c). § 50155. Court Order , What to Include. Stay o f Pro ceed ings Against Debtor . Appointment of an Assignee or Receiver .

demurrers have been abolished by the Guam Rules of Civil Procedure, Rule 7(c). § 50155. Court Order , What to Include. Stay o f Pro ceed ings Against Debtor . Appointment of an Assignee or Receiver . If the respondent shall make default, or if, after trial, the issues are found in favor of the petitioners, the court shall make an order adjudging that said respon dent is, and was at the time of filing the peti tion, an insolvent debtor and that the debtor was guilty of the acts and things charged in the petition, or such of them as the court may find to be true; and shall require said debtor, within such time as the court may designa te, not to exceed three (3) days, to file in court the schedule and inventory provided COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 14for in § 50101 and § 50102 of this Title, duly verified as re quired of a petitioning debtor; provided, that in the affidavit of the insolvent debtor, touching his prope rty and its disposition, he shall not be required to swear that he has not made any fraudulent preference or committed any other act in conflict with the provisions of law; but he may do so if he desires.

nd its disposition, he shall not be required to swear that he has not made any fraudulent preference or committed any other act in conflict with the provisions of law; but he may do so if he desires. The order shall further direct a commissioner , or t he receiver, if one has been theretofore appointed, to take possession of and safely keep, until the appointment of an assignee, all the deeds, vouchers, books of accounts, papers, notes, bills, bonds, and securities of the debt or, and all his real and personal property , estate, and effects, except such as may be by law exempt from execution. The order shall further forbid the payment to the debtor of any debts due to him, and the delivery to the debtor, or any person for him, of any property belonging to him, and the transfer of any property by him, and shall further appoint a time and place for a meeting of the creditors to choose an assignee of the es tate. Said order shall be published as often as may be prescribed by the court. The time appointed for the election of an assignee shall not be less than two (2) weeks nor more than three (3) months from the date of the order of adjudication.

n as may be prescribed by the court. The time appointed for the election of an assignee shall not be less than two (2) weeks nor more than three (3) months from the date of the order of adjudication. Upon the granting of the said order, all civil proceedings pending against the said insolvent shall be stayed. When an assignee is chosen as provided in this Chap ter, the commissioner or receiver , if there be one, shall thereupon deliver to such assignee all the property , estate, and belongings of the insolvent, which have come into his possession, and he shall be allo wed and paid as compensation for his services the same expenses and fees as would by law be collectible if the property had been levied upon and safely kept under attachment. SOURCE: CCP § 1314. § 50156. Publication of Court Order . A copy of the order p rovided for in the last preceding section shall immediately be published by the clerk of the court in the usual manner for the number of times and as prescribed by the court. Upon the filing, at any time before the date set for such meeting, of the schedul e required by said last preceding section, a copy of said order shall be delivered personally or sent by the

e court. Upon the filing, at any time before the date set for such meeting, of the schedul e required by said last preceding section, a copy of said order shall be delivered personally or sent by the clerk forthwith by registered mail, postage prepaid, to all creditors named in said schedule. If said schedule is not filed prior to the day fixed for the election of an assignee, publication of said order as herein COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 15required shall be of itself sufficient notice to the creditors of the time and place appointed for the election of an assign ee. No order of adjudication upon credi tor's petition shall b e ent ered unless there be first deposited, in addition to the costs of commencing said proceedings, a sum of money sufficient to defray the expense of the publica tion ordered by the court, necessary postage, and ten cents ($0.10) for each copy to be deliv ered personally or mailed to the creditors. The last -named sum is hereby constituted the legal fee for the personal delivery or mailing required by this section. SOURCE: CCP § 1315. § 50157. Court Order: When Debtor Resides Out of Guam; Undertaking Requ ired .

m is hereby constituted the legal fee for the personal delivery or mailing required by this section. SOURCE: CCP § 1315. § 50157. Court Order: When Debtor Resides Out of Guam; Undertaking Requ ired . In all cases where the debtor resides out of Guam; or has departed from Guam; or cannot, after due diligence, be found within Guam; or conceals himself to avoid service of the order to show cause, or any other preliminary process or orders in the ma tter; or is a foreign corporation having no managing or business agent, cashier , or secretary within Guam upon whom service or orders and process can be made, and it there fore becomes necessary to obtain service of process and order to show cause, as provided in § 50153 of this Title, then the petitioning credi tors, upon submitting the affidavits requisite to procure an order of publication, and presenting a bond in double the amount of the aggregate sum of their c laims against the debtor, shall be entitl ed to an order of the court directing a commissioner to take into his custody a sufficient amount of property of the debtor to satisfy the demands of the petitioning creditors and the costs of the proceedings.

rder of the court directing a commissioner to take into his custody a sufficient amount of property of the debtor to satisfy the demands of the petitioning creditors and the costs of the proceedings. Upon receiving such order of the court to take into custody property of the debtor , it shall be the duty of the com missioner to take possession of the property and effects of the debtor , not exempt from execu- tion, to an extent sufficient to cover the amount provided for, and to pre pare, within three (3) days from the time of taking such possession, a complete inventory of all the property so taken, and to return it to the court as soon as complet ed. The time for taking the inventory and making re turn thereof may be extended for good cause shown to t he court. The commissione r shall also prepare a schedule of the names and resi dences of the creditors, and the amount due each, from the books of the debtors, or from such other papers or data of the debtor available as may come to his possession, and sha ll file such schedule list of creditors and inventory with the clerk of the court. SOURCE: CCP § 1316. COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 16§ 50158.

may come to his possession, and sha ll file such schedule list of creditors and inventory with the clerk of the court. SOURCE: CCP § 1316. COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 16§ 50158. Bonds, Conditions; Exceptions. In all cases where property is taken into custody bythe commissioner , as provided in the preced ing section, if it does not embrace all the prop erty and effects of the debtor not exempt from execution, any other creditor or creditors of the debtor , upon giving bond to be approved b y the court in double the amount of their claims, singly or jointly , shall be enti tled to similar orders, and to like action, b y the commis sioner , until all claims be provided for , if there be sufficient property or effects. All property taken into custody bythe commissioner b y virtue of the giving of any such bonds shall be held b y him for the benefit of all creditors of the debtor whose claims shall be duly proved, and as provided in this section. The bonds provided for in this and the preceding section to procure the order for the custody of the property and effects of the debtor sh all be conditioned that if, upon final hearing of the petition in insolvency ,

for in this and the preceding section to procure the order for the custody of the property and effects of the debtor sh all be conditioned that if, upon final hearing of the petition in insolvency , the court shall find in favor of the petitioners, such bonds and all of them shall be void; if the decision be in favor of the debtor , the proceed ings shall be dismissed and the debtor , his heirs, administrators, executors, or assigns shall be entitled to recover such sum of money as shall be sufficient to cover the damages sus tained by him, not to exceed the amount of the respective bonds. Such damages shall be fixed and allowe d bythe court if either the petitioners or the debtor shall appeal from the decision of the court, upon final hearing of the petition the appellant shall be required to give undertaking to the successful party in a sum double the amount of the value of the property in contro versy,and for the costs of the proceedings. Such undertaking shall be approved b y the court. Anyperson interested in the estate may except to the sufficiency of the sureties on such bond or bonds.

o versy,and for the costs of the proceedings. Such undertaking shall be approved b y the court. Anyperson interested in the estate may except to the sufficiency of the sureties on such bond or bonds. When excepted to, the petition er's sureties, upon notice to the person except ing of not less than two (2) nor more than five (5) days, must justify as to their sufficiency; and upon failure to justify , or if others in their places fail to justify at the time and place ap pointed, the judge shall issue an order vacating the order to take the property of debtor into the custody of the commissioner , or denying the appeal, as the case may be. SOURCE: CCP § 1317. § 50159. Sale of Property; Deposit of Pro ceeds. If, in any case, proper affidav its and bonds are presented to the court asking for and obtaining an order of publication and an order for the custody of the property of the debtor , as provided in § 50157 and § 50158 of this Article, and thereaf ter the petitioners shall make it appear s atisfactorily to the court that the inter est of the parties to the proceedings will be subserved b y a sale thereof, the court may order such property to be sold in the same manner as property

ear s atisfactorily to the court that the inter est of the parties to the proceedings will be subserved b y a sale thereof, the court may order such property to be sold in the same manner as property is COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 17sold under execution, the proceeds to be deposited with the Treasurer of Guam to abide the result of the proceedings. SOURCE: CCP § 1318. ---------- ARTICLE 5 ASSIGNEES § 50200. Filing and Proof of Claims; Exceptions to Creditors Permitted to Vote. § 50201. Election of an Assignee; Bond Required. § 50202. Cour t to Appoint Assignee. § 50203. Delivery of Debtor's Property to Assignee. § 50204. Assignee Right to Recover. § 50205. Filing of Schedule and Inventory. § 50206. Resignation of the Assignee. § 50207. Power of Assignee. § 50208. Embezzlement by Perso n, Having Notice of Proceedings. § 50209. Conversion of Property into Cash; Sale. § 50210. Sale of Perishable Property. § 50211. Outstanding Assets of Debtor, Sale or Compromise. § 50212. Costs Allowed Assignee. § 50213. Assignee to Render Accounts; Au dit of. § 50214. Funds for Distribution. § 50215. Dividends Declared, Not to be Stayed. § 50216.

Debtor, Sale or Compromise. § 50212. Costs Allowed Assignee. § 50213. Assignee to Render Accounts; Au dit of. § 50214. Funds for Distribution. § 50215. Dividends Declared, Not to be Stayed. § 50216. Failure of Assignee to Render Accounts; Duty of Court. § 50217. Assignee Discharge; Final Account. § 50200. Filing and Proof of Claims; Exceptions to. Cre ditors permitted to Vote. No creditor shall be entitled to vote for the election of an assignee unless he shall have filed his claim in the office of the clerk of the court at least two (2) days prior to the time appointed for such election. All claims shall contain a statement showing the amount and nature of the claim and security , if any . The claim shall be verified by the claimant, or his duly authorized agent or attorney . No claim barred by the statute of limitations shall be proved or allowed against the estate of an insolvent debtor for any purpose. Any person interested in the estate of the insolvent may file exceptions to the legality or good faith of any claim, by setting forth specifi -COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 18cally in writing his interest in the estate, and the ground of his objection to

the legality or good faith of any claim, by setting forth specifi -COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 18cally in writing his interest in the estate, and the ground of his objection to such claim. Such exceptions shall be verified by the affida vit of the party objecting, or his duly authorized agent or attorney , and the affidavit shall set out that such exceptions are not made for the purpose of delay and are made in good faith in the best interest of said estate. Exceptions to any claim must be filed with the clerk of the court at least one (1) day before the time appointed for the election of an assignee, and such exceptions shall be heard and disposed of by the court , on affidavit or other evidence, in a summa ry manner, before the election of an assignee. No creditor or claimant who holds any mortgage, pledge, or lien of any kind whatever as security for the payment of his claim or attachment or execution on propert y of t he debtor duly record ed and not dissolved under this Title shall be permitted to vote at the election of the assignee any part of his secured claim unless he shall first have the value of such security fixed as provided in § 50356 of this

ed under this Title shall be permitted to vote at the election of the assignee any part of his secured claim unless he shall first have the value of such security fixed as provided in § 50356 of this Chapte r, or shall surrender to the commissioner or receiver of the estate of the insolvent debtor, if there be a receiver , all such property , or assign such lien to such commissioner or receiver. The surrender or assignment of such security or lien shall be for the benefit of all creditors of the estate of the insolvent. The value of such security , if fixed by the court, shall be so fixed at least one (1) day before the day appointed for the election of an assignee, in which event the claimant may prove his demand as provided in this section for any unsecured balance, subject to the filing of exceptions as in all other claims. SOURCE: CCP § 1320. § 50201. Election of an Assignee; Bond Re quired. At a meeting of the creditors in open court, or if the court is not in session, in the presence of the judge or the clerk of court, those being entitled to vote, as provided by the preceding section, shall proceed to the election of an assignee.

r if the court is not in session, in the presence of the judge or the clerk of court, those being entitled to vote, as provided by the preceding section, shall proceed to the election of an assignee. The majority of the creditors who have proven their claims, such majority being both in number and amount, must concur for the election of an assignee. The clerk of the court must keep minutes of the deliberations of the creditors, and of the election and appoint ment of the assignee, and enter the same upon the records of the court, and, in the absence of the judge, shall send a copy of such record to him at the place where he may be found. The assignee shall file, within five (5) days, unless the time be extended by the court, with the clerk, a bond, in an amount to be fixed by the c ourt, to the government of Guam, with two or more sufficient sureties, approved by the court, and conditioned upon the faithful COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 19performance of the duties devolving upon him. The bond shall not be void upon the first recovery , but may be sued upon from time to time by any person aggrieved, in his own name, until the whole penalty be exhausted.

duties devolving upon him. The bond shall not be void upon the first recovery , but may be sued upon from time to time by any person aggrieved, in his own name, until the whole penalty be exhausted. The sureties on such bond may be required to justify as to their sufficiency upon the application of any party interested. SOURCE: CCP § 1321. § 50202. Court to Appo int Assignee. If, on the day appointed for the meeting, creditors do not attend, or fail or refuse to elect an assign ee, or if, after election, the assignee shall fail to qualify within the proper time, or if a vacan cy occurs by death or otherwise, the court shall appoint an assignee and fix the amount of his bond. SOURCE: CCP § 1321a. § 50203. Delivery of Debtor's Property to Assignee. As soon as the assignee is elected or appointed and qualified, the clerk of the court shall, by an instrument under seal of the court, assign and convey to the assignee all the real and personal property , estate, and effects of the debtor with all his deeds, books, and papers relating thereto, and such assignment shall relate back to the commencement of the proceed ingsin insolvency , and shall relate back to the acts upon which the

r with all his deeds, books, and papers relating thereto, and such assignment shall relate back to the commencement of the proceed ingsin insolvency , and shall relate back to the acts upon which the adjudication was founded, and by opera tion of law shall vest the title to all such prope rty, estate, and effects in the assign ee, although the same is then attached on mesne process, as the property of the debtor . Such assignment shall operate to vest in the assignee all of the estate of the insolvent debtor not exempt by law from execution. It shall also dissolve any attachment levied within one (1) month next preceding the commencement of the insolvency proceedings and vacate and set aside any judgment entered in any action commenced within thirty (30) days immediately prior to the commencement of insolvency proceedings any shall vacate and set aside any execution issued thereon and shall v acate and set aside any judgment entered by default or consent of the debtor within thirty (30) days immediately prior to the commence ment of the insolvency proceedings. SOURCE: CCP § 1322. § 50204. Assignee Right to Recover .

ment entered by default or consent of the debtor within thirty (30) days immediately prior to the commence ment of the insolvency proceedings. SOURCE: CCP § 1322. § 50204. Assignee Right to Recover . The assignee shall have th e right to recover all the estate, debts, and effects of said insolvent. If, at the time of the commencement of proceedings in insolvency , an action is pending in the name of the debtor , COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 20for the recovery of a debt or other thing which might or ought to pas s to the assignee by the assignment, the assignee shall be allowed and admitted to prosecute the action in like manner and with like effect as if it had been originally commenced by him. If there are any rights of action in favor of the insolvent for damag es, on any account, for which an action is not pending, the assignee shall have the right to prosecute the same with the same effect as the insolvent might have done himself if no proceed ings in insolvency had been instituted. If any action or proceeding in which the insolvent is the defendant is pending at the time of the adjudication, the assignee may defend the same in the same manner and with

vency had been instituted. If any action or proceeding in which the insolvent is the defendant is pending at the time of the adjudication, the assignee may defend the same in the same manner and with like effect as it might have been defended by the insolvent. In a suit prosecuted or de fended bythe assignee, a certified copy of the assignment made to him shall be conclusive evidence of his authority to sue or defend. SOURCE: CCP § 1323. § 50205. Filing of Schedule and Inventory. The assignee shall, within one (1) month after the making of the assign ment to him, cause the same to be recorded in the registry of lands, etc., and the record of such assignment, or a duly certified copy thereof, shall be conclusive evidence thereof in all courts. If the schedule and inventory required by this section have not been filed by the debtor , the assignee shall within one (1) month after his election, prepare and file such schedule and inventory from the best information he can obtain, and shall there upon personally deliver notice or send same by registered mail, postage prepaid, to all creditors named in such schedule, whose claim s have not been filed, to forthwith prove their demands.

ll there upon personally deliver notice or send same by registered mail, postage prepaid, to all creditors named in such schedule, whose claim s have not been filed, to forthwith prove their demands. SOURCE: CCP § 1324. § 50206. Resignation of the Assignee. Any assignee may at any time, by a writing filed in court, resign his appoint ment, having first settled his accounts and delivered all the deeds, vouchers, books of account, notes, bills, bonds, and securities of the debtor and all his real and personal property , estate, and effects to such successor as the court shall appoint; pr ovided, that if in the discretion of the court the circum stances of the case require it, upon good cause being shown, the court may , at any time before such settlement of account and delivery of the estate shall have been completed, revoke the appointment of such assignee and appoint anoth er in his stead. The liability of the outgoing assignee, or of COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 21the sureties on his bond, shall not be in any manner discharged, released, or affected by such appointment of another in his stead. SOURCE: CCP § 1325. § 50207. Power of Assignee.

.50INSOLVENCY LAW 21the sureties on his bond, shall not be in any manner discharged, released, or affected by such appointment of another in his stead. SOURCE: CCP § 1325. § 50207. Power of Assignee. The said assign ee shall have power: 1. To sue and recover all the estate, assets, debts, and claims, belonging to or due to such debtor; and no set -off or coun terclaim shall be allowed in any such suit for debts contracted by th e insolvent within thirty (30) days immediately preceding the filing of the petition of insolvency except in case of creditors specified in § 50252 of this Chapter . 2. To take into his possession all the estate of such debtor , except property ex empt by lawfrom execution, whether attached or delivered to him, or afterwards discov ered, and all books, vouchers, evidence of indebtedness, and securities belonging to him. 3. In case of a nonresident or absconding or concealed debtor, to demand and receive of every commissioner who shall have attached any of the property of such debtor, or who shall have in his possession any moneys arising from the sale of such property and moneys, on paying his lawful costs and charges for attaching and keeping them. 4.

he property of such debtor, or who shall have in his possession any moneys arising from the sale of such property and moneys, on paying his lawful costs and charges for attaching and keeping them. 4. From time to time to sell at public auction after advertisement in the manner provided by subsections 1, 2, and 3 of § 23113 of this Title, upon order of the court, any of the estate, real and personal, which has come into his possession and which is vested in him as such assignee, and on such sales to exe cute the neces saryconveyances and bills of sale. 5. To redeem all valid mortgages and conditional contracts, and all valid pledges of personal property , and to satisfy any judg ments which may be an encum brance on any property sold by him or to sell such proper ty, subject to such mortgage, contract, pledges, judgments, or liens. 6. To settle all matters and accounts between such debtor and his debtors, subject to the approval of the court. 7. Under the order of the court or judge appoint ing him, to compound with any person indebted to such debtor, and thereupon discharge all demands against such persons. COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 228.

e court or judge appoint ing him, to compound with any person indebted to such debtor, and thereupon discharge all demands against such persons. COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 228. To recover from any person receiving a convey ance, gift, transfer, payment, or assignment, made contrary to any provision of this Title, the property thereby transferred or assigned; or in case a redelivery of the property cannot be had, to recover the value thereof, with damages for the detention. SOURCE: CCP § 1326. § 50208. Embezzlement by Pers on, Having Notice of Proceedings. If any person, before the assignment is made, having notice of the commencement of the proceedings in insolvency , or having reason to believe that insolvency pro ceedings are about to be commenced, em bezzles or dispos esof any of the moneys, goods, chat tels, or effects of the insolvent, he is chargeable therewith, and liable to an action by the assignee for double the value of the proper tyso embezzled or disposed of, to be recovered for the benefit of the insolvent's estate. SOURCE: CCP § 1327. § 50209. Conversion of Property into Cash; Sale.

ignee for double the value of the proper tyso embezzled or disposed of, to be recovered for the benefit of the insolvent's estate. SOURCE: CCP § 1327. § 50209. Conversion of Property into Cash; Sale. The assignee shall as speedily as possible convert the estate, real and personal, into money . He shall keep a regular account of all moneys received by him as assignee, to whic h every creditor or other person interested therein may , at all reasonable times, have access. No private sales of any property of the estate of an insolvent debtor shall be valid unless made under the order of the court, upon a petition in writing, which shall set forth the facts showing it to be necessary . Upon filing the petition, notice of the hearing thereof of at least ten (10) days shall be given by publica tion and mailing, in the same manner as is provided in § 50105. If it appears that a private s ale is for the best interests of the estate, the court shall order it to be made. SOURCE: CCP § 1328. § 50210. Sale of Perishable Property. In all cases when it appears to the satisfaction of the court that the estate of the debtor , or any part thereof, is of a perishable nature, or is liable to

28. § 50210. Sale of Perishable Property. In all cases when it appears to the satisfaction of the court that the estate of the debtor , or any part thereof, is of a perishable nature, or is liable to deteriorate in value, or is disproportionately expensive to keep, and that the insolvent's estate will suffer if sufficient time elapses for the giving of notice, the court may order the same to be sold in such m anner and at such time as may be deemed most expedient, under the direction of the COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 23commissioner, receiver, or assignee, as the case may be, who shall hold the funds received in place of the property sold until further order of the court. SOURCE: CCP § 1329. § 50211. Outstanding Assets of Debtor , Sale or Compro mise. Outstanding debts, or other prop erty due or belong ing to the estate, which cannot be collected and received by the assignee without reasonable or inconvenient delay or expense, may be sold and assigned in like manner as the remainder of the estate. If there are any rights of action for damages in favor of the insolvent prior to the commence ment of the insolvency proceedings, the same may , with the approval

nner as the remainder of the estate. If there are any rights of action for damages in favor of the insolvent prior to the commence ment of the insolvency proceedings, the same may , with the approval of the court, be compromised. SOU RCE: CCP § 1330. § 50212. Costs Allowed Assignee. Assignees shall be allowed all necessary expenses in the care, management, and settlement of the estate, and shall be entitled to charge and receive for their services commissions upon all sums of money co ming to their hands and accounted for by them, as follows: For the first one thousand dollars ($1,000.00), at the rate of seven percent (7%); for all above that sum and not exceeding ten thousand dollars ($10,000.00), at the rate of five percent (5%); and for all above that sum, at the rate of four percent (4%); provided, howev er, that if the person acting as assignee was receiver of the property of the estate pending the election of an assignee, any compensation allowed him as such receiver shall be deduc ted from the compensation to which he otherwise would be entitled as suc h assignee; and provided further, that if there should be two or more assignees the court shall order an equitable division

uc ted from the compensation to which he otherwise would be entitled as suc h assignee; and provided further, that if there should be two or more assignees the court shall order an equitable division of the compensation herein provided, and if for any reason a n assignee's term is completed before the final settlement of the estate and a successor is appointed, the court shall not allow to any such assignee prior to the settlement of the estate an amount exceeding four percent (4%) of the sums of money coming in to his hands. Upon the final settlement of the estate an equitable distribution of the compensa tion of the assignee shall be made. SOURCE: CCP § 1331. § 50213. Assignee to Render Accounts; Audit of. At the expiration of three (3) months from the appoin tment of the assignee in any case, or as much earlier as the court may direct, a time and place shall be fixed by the court at which the assignee shall file just and true COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 24accounts of all his receipts and payments with proper vouch ers, verified by his oath , and a statement of the property outstanding, specifying the causes of its remaining outstanding, also what debts or

unts of all his receipts and payments with proper vouch ers, verified by his oath , and a statement of the property outstanding, specifying the causes of its remaining outstanding, also what debts or claims are yet undetermined, and stating what sum remains in his possession, and shall accom pany the same with an affidavit that notice b y registered mail has been given to all creditors named in the schedule filed by the debtor or the assignee that said accounts will be heard at a time specified in such notice, which time shall not be less than two (2) weeks nor more than three (3) months from the filing of such ac counts. At the hearing the court shall audit the accounts of the assignee, and any person inter ested may appear and file exceptions thereto and contest the same. The court thereupon shall confirm said accounts if they shall be f ound to be correct, or order the same corrected if errors shall be found therein. The court shall also, in such hearing, deter mine the property which must be deducted from the estate as another's under the provisions of § 50250 of this Chapter , and the ri ght of the claimants to participate in the dividend, and may order a dividend paid to

which must be deducted from the estate as another's under the provisions of § 50250 of this Chapter , and the ri ght of the claimants to participate in the dividend, and may order a dividend paid to those creditors whose claims have been proven and allowed. The deci sion of the court theretofore rendered as to whether any claimant was entitled to vote for an assignee shall not be conclusive upon the right of the claimant to share in such dividend; but all claimants who were so allowed to vote shall participate in such dividend unless objections were filed to the same prior to such hearing. If any objections have been filed against any claim, or if any claimant was refused the right to vote, the court shall determine said objections and the rights of all such claim ants in such hearing and refuse or allow the same before the declaration of a dividend. Thereafter, furthe r accounts, statements, and dividends shall be made in like manner as often as occasion requires; provided however, that it shall be the duty of the assignee to file his final account within one (1) year from the date of the order of adjudication, unless the court, after notice to creditors, shall grant further

r, that it shall be the duty of the assignee to file his final account within one (1) year from the date of the order of adjudication, unless the court, after notice to creditors, shall grant further time, upon a satisfactory showing that great loss and waste would result to the estate by reason of the conversion of the property into money within said time, or that it has been impossible to do s o by reason of litigation. SOURCE: CCP 1331. § 50214. Funds for Distribution. The court may at any time, upon the motion of any two or more creditors, require the assignee to file his accounts in the manner and upon COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 25giving the notice specified in the pre ceding section, and if he has funds subject to distribution he may be required to distribute them without delay . SOURCE: CCP § 1332. § 50215. Dividends Declared, Not to be S tayed. When ever a dividend has been duly declared, the distribution of it shall not be stayed or affected by reason of debts being subsequently proved, but any creditor proving such a debt shall be entitled to a dividend equal to those already received by the other creditors before any other dividend is made to the

f debts being subsequently proved, but any creditor proving such a debt shall be entitled to a dividend equal to those already received by the other creditors before any other dividend is made to the latter, if the fail ure to prove such claim shall not have resulted from his own neglect. SOURCE: CCP § 1333. § 50216. Failure of Assignee to Render Ac counts; Duty of Court. Should the assignee refuse or neglect to render his accounts as re quired by§ 50213 and § 50214 of this Chapter, or refuse or neglect to pay over a dividend when he shall have, in the opinion of the court, sufficient funds for that purpose, or shall neglect or mismanage the estate in any manner whatever or violate any of the provisions of this Chapter, the court shall immediately discharge such assignee from his trust, and shall appoint another in his place. The assignee so discharged shall forthwith deliver over to the assignee appointed by the court all the funds, property , books, vouchers, or securit ies belonging to the insolvent, and he shall not be entitled for his services to the compensation provided in § 50213. SOURCE: CCP § 1334. § 50217. Assignee Discharge; Final Account.

hers, or securit ies belonging to the insolvent, and he shall not be entitled for his services to the compensation provided in § 50213. SOURCE: CCP § 1334. § 50217. Assignee Discharge; Final Account. Preparato ryto the settlement of the estate, the assignee shall file his final account in the court, accompanying the same with an affidavit that a notice by registered mail has been given to all creditors who have proved their claims, that he will apply for a settlement of his account and for a discharge from all liability as assignee at a time specified in such notice, which time shall not be less than two (2) weeks nor more than three (3) months from such filing. At the hear ing the court shall audit the account, and any person interested may appear and file exceptions in writing and contest the same. The court thereupon shall settle the account, and order a dividend of any portion of the estate, if any , remaining undistributed, and shall discharge the assignee, subject to compliance with the order of the court, from all l iability as assignee to any creditor of the insolvent. COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 26SOURCE: CCP § 1335.

assignee, subject to compliance with the order of the court, from all l iability as assignee to any creditor of the insolvent. COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 26SOURCE: CCP § 1335. ----------- ARTICLE 6 CLASSI FICA TION AND PREFERENCE OF CREDITORS § 50250. Property Exempt From Disposition for the Benefit of Creditors. § 50251. Creditors, Paid Pro Rata. § 50252. Preferred Claims. § 50250. Property Exempt from Disposition for the Ben efit of Creditors. Merchandise, effects, and any other kind of property found among the property of the insol vent, the ownership of which has not been conveyed to him by a lega l and irrevocable title, shall be considered to be the property of other persons and shall be placed at the disposal of its lawful owners on order of the court made at the hearing mentioned in § 50213, or at any ordinary hearing, if the assignee or any cre ditor whose right in the estate of the insolvent has been established shall petition in writing for such hearing and the court in its discretion shall so order, the credi tors, however, retaining such rights in said property as belong to the insolvent, and subro - gating him whenever they shall have complied

ng and the court in its discretion shall so order, the credi tors, however, retaining such rights in said property as belong to the insolvent, and subro - gating him whenever they shall have complied with all obligations concerning said property . The following shall be included in this section: 1. All the separate property of the wife, owned by her before marriage, and that acquired afterwards by gif t, bequest, devise, or descent, with the rents, issues and profits thereof, as provided in 19 GCA §§ 6111 -6114. 2. Property and effects deposited with the insol vent, or administered, leased, rented, or held in trust by him. 3. Merchandise in the posses sion of the insolvent, on commission, for purchase, sale, forwarding, or delivery . 4. Bills of exchange or promissory notes without endorsement or other expression transferring owner ship remitted to the insol vent for collection and all others acquired by him for the account of another person, drawn, or endorsed to the remittor direct. 5. Money remitted to the insolvent, other wise than on current account, and which is in his possession for delivery to a definite person COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 27in the

ct. 5. Money remitted to the insolvent, other wise than on current account, and which is in his possession for delivery to a definite person COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 27in the name and for the account of t he remitter or for the settlement of claims which are to be met at the insolvent's domicile. 6. Amounts due the insolvent for sales of merchan dise on commission, and bills of exchange and promis sory notes derived there - from in his possession, even when t he same are not made payable to the owner of the merchandise sold, provided it is proven that the obligation to the insolvent is derived therefrom and that said bills of exchange and promissory notes were in the possession of the insolvent for account of t he owner of the merchandise to be cashed and remitted, in due time, to the said owner; all of which shall be a legal presumption when the amount involved in any such sale shall not have been credited on the books of both the owner of the merchandise and ofthe insol vent. 7. Merchandise bought on credit by the insolvent so long as the actual delivery thereof has not been made to him at his store or at any other place stipulat ed for such delivery ,

d ofthe insol vent. 7. Merchandise bought on credit by the insolvent so long as the actual delivery thereof has not been made to him at his store or at any other place stipulat ed for such delivery , and merchandise the bills of lading or shipping receipts of which have been sent him after the same has been loaded by order of the purchaser and for his account and risk. In all cases arising under this section assignees may retain the merchandise so purchased or claim it for the creditors by paying the price ther eof to the vendor . 8. Goods or chattels wrongfully taken, converted, or withheld by the insolvent if still existing in his possession or the amount of the value thereof. SOURCE: CCP § 1340. § 50251. Creditors, Paid Pro Rata. All credi tors, except thos e whose claims are mentioned in the next following section, whose debts are duly proved and allowed, shall be entitled to share in the property and estate pro rata, after the property belonging to other persons referred to in the last preceding section has been deducted therefrom, without priority or preference what ever; provided, that any debt proved by any person liable as bail, surety , guarantor, or otherwise, for the

he last preceding section has been deducted therefrom, without priority or preference what ever; provided, that any debt proved by any person liable as bail, surety , guarantor, or otherwise, for the debtor, shall not be paid to the person so proving the same until satisfactory evidenc e shall be produced of the payment of such debt by such person so liable, and the share to which such debt would be entitled may be paid into court, or otherwise held, for the benefit of the party entitled thereto, as the court may direct. COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 28SOURCE: CCP § 1341. § 50252. Preferred Claims. The following shall be preferred claims which shall be paid in the order named: (a) Legal expenses, and expenses incurred in the administration of the insolvent's estate for the common interest of the creditors, when prope rly authorized and approved by the court; (b) Necessary funeral expenses of the debtor , or of his wife, or children who are under their parental authority and have no prope rtyof their own, when approved by the court; (c) Debts, taxes, and assessments due the govern ment of Guam; (d) Debts for personal services rendered the insolvent by clerks,

thority and have no prope rtyof their own, when approved by the court; (c) Debts, taxes, and assessments due the govern ment of Guam; (d) Debts for personal services rendered the insolvent by clerks, laborers, or domestic servants during the sixty (60) days immedi ately preceding the commencement of proceed ings in insolvency , not to exceed two hundred dollars ( $200.00) for each claim ant. SOURCE: CCP § 1342. ---------- ARTICLE 7 PARTNERSHIPS AND CORPORA TIONS § 50300. Partnerships. § 50301. Corporations. § 50300. Partnerships. A partnership, during the continuation of the partnership business, or during i ts dissolution until final settlement thereof, may be adjudged insolvent, either upon the petition of the partners, or any one of them, or upon petition of two or more creditors of the partnership qualified as provided in § 50150 of this Chapter . The court shall issue an order appointing a receiver therefor and rendering the property of the partner ship and the separate property of each of the partners liable in accor dance with the provisions of this Chapter and in accordance with the provisions of the Civil Code. SOURCE: CCP § 1345.

e partner ship and the separate property of each of the partners liable in accor dance with the provisions of this Chapter and in accordance with the provisions of the Civil Code. SOURCE: CCP § 1345. COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 29§ 50301. Corporations. The provisions of this Chapter shall apply to associations and corpora - tions and upon the petition of any officer of any association or corporation, duly authorized by the vote of the board of directors or trustees, at a meeting specially called for that purpose, or by the assent in writing of a majority of the directors or trustees, as the case may be, or upon a creditor's petition made and presented in the manner provided in respect to debtors, like pr oceedings shall be had and taken as are provided in the case of debtors; provided, that in case the articles of association or by -laws of any association or corporation provide a method for such proceedings, such method shall be followed. All the provision s of this section which apply to the debtor, or set forth his duties, examina tion, and liabilities, or prescribe penal ties, or relate to fraudulent conveyances, pay ments and assignments, apply to each

this section which apply to the debtor, or set forth his duties, examina tion, and liabilities, or prescribe penal ties, or relate to fraudulent conveyances, pay ments and assignments, apply to each and every officer of any association or corporation in relation to the same matters concerning the corporation. Whenever any corporation is de clared insolvent, its proper tyand assets shall be distributed to the creditors; but no discharge shall be granted to any corporation. The provi - sions of the sectio n shall not apply to any corporation as to which there is any special provision of law for its liquida tion in case of insolvency. SOURCE: CCP § 1346. ---------- ARTICLE 8 PROOF OF DEBTS § 50350. What May Be Proved. § 50351. Debtor as Endorser , Suret y,Bail or Guarantor. § 50352. Contingent Debts and Liabilities. § 50353. Persons Liable as Surety , etc., for Debtor. § 50354. Rent. § 50355. Mutual Debts and Credits; Set -off. § 50356. Creditor Holding Mortgage or Lien. § 50357. Creditor W aives Right s of Action. § 50358. Creditors Accepting Preference may not Prove. § 50359. Examination of the Debtor . § 50350.

Set -off. § 50356. Creditor Holding Mortgage or Lien. § 50357. Creditor W aives Right s of Action. § 50358. Creditors Accepting Preference may not Prove. § 50359. Examination of the Debtor . § 50350. What May Be Proved.COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 30All debts due and payable from the debtor at the time of the adjudication of insolvency , and all debts then existing bu t not payable until a future time, a discount being made if no interest is payable by the terms of the contract, may be proved against the estate of the debtor . SOURCE: CCP § 1350. § 50351. Debtor as Endorser , Surety, Bail or Guarantor . If the debtor is bound by endorser, surety , bail or guaran tor, upon any bill, bond, note or other specialty or contract, or for any debt of any person, and his liability shall not have become absolute until after the adjudication of insolvency , the creditor may prove the same after such liability shall have become fixed, and before the final dividend shall have been declared. SOURCE: CCP § 1351. § 50352. Contingent Debts and Liabilities. In all cases of contingent debts and contingent liabilities, contrac ted by the debt or and not herein otherwise provided

been declared. SOURCE: CCP § 1351. § 50352. Contingent Debts and Liabilities. In all cases of contingent debts and contingent liabilities, contrac ted by the debt or and not herein otherwise provided for , the creditor may make claim therefor and have his claim allowed, with right to share in the dividends, if the contin gency shall happen before order of the final dividend, or he may , at any time, apply to the court to have the present value of the debt or liability ascertained and liquidated, which shall be done in such manner as the court shall order, and it shall be allowed for the amount so ascer tained. SOURCE: CCP § 1352. § 50353. Persons Liable as Surety, Et c., for Debtor . Any person liable as bail, surety , or guarantor , or otherwise, for the debtor, who shall have paid the debt, or any part thereof, in discharge of the whole, shall be entitled to prove such debt, or to stand in the place of the creditor , ifhe shall have proved the same, although such payments shall have been made after the proceedings in insolvency were com menced; and any person so liable for the debtor, and who has not paid the whole of said debt, but is still liable for the same, or any part

have been made after the proceedings in insolvency were com menced; and any person so liable for the debtor, and who has not paid the whole of said debt, but is still liable for the same, or any part thereof, may , if the creditor shall fail or omit to prove such debt, prove the same in the name of the creditor . SOURCE: CCP § 1353. § 50354. Rent.COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 31Where the debtor is liable to pay rent, or other debt falling due at fixed and stated periods, the c reditor may prove for a proportionate part thereof, up to the time of the insolvency , as if the same became due from day to day , and not at such fixed and stated periods. SOURCE: CCP § 1354. § 50355. Mutual Debts and Credits; Set -off. In all cases of mu tual debts and mutual credits between the parties, the account between them shall be stated, and one debt set off against the other, and the balance only shall be allowed and paid. But no set -off or counterclaim shall be allowed of a claim in its nature no t provable against the estate; provid ed, that no set -off or counterclaim shall be allowed in favor of any debtor to the insolvent of a claim purchased by or transfe rred to such

im in its nature no t provable against the estate; provid ed, that no set -off or counterclaim shall be allowed in favor of any debtor to the insolvent of a claim purchased by or transfe rred to such debtor within thirty (30) days immedi ately preceding the filing, or after thefiling of the petition by or against the insolvent. SOURCE: CCP § 1355. § 50356. Creditor Holding Mortgage or Lien. When a creditor has a mortgage, or pledge of real or personal property of the debtor , or a lien thereon, for securing the payments of a debt owing to him from the debtor , or an attach ment or execution on property of the debtor duly recorded and not dissolved under this Title, he shall be admitted as a creditor for the balance of the debt only , after deducting the value of such property , such value to be ascer tained by agreement between him and the receiv er, if any , and if no receiver, then upon such sum as the court may decide to be fair and reasonable, before the election of an assignee, or by a sale thereof, to be made in such manner a s the court shall direct; or the creditor may release or convey his claim to the receiver , if any , or if no receiver then to the commissioner ,

ee, or by a sale thereof, to be made in such manner a s the court shall direct; or the creditor may release or convey his claim to the receiver , if any , or if no receiver then to the commissioner , before the election of an assignee, or to the assignee if an assignee has been elected upon such property , and be admitted to prove his whole debt. If the value of the property exceeds the sum for which it is held as security , the assignee may release to the creditor the debtor's right of redemption thereon on receiving such exce ss; or he may sell the property , subje ct to the claim of the creditor thereon, and in either case the assignee and creditor, respectively , shall execute all deeds and writings necessary or proper to consummate the transaction. If the property is not sold or released, or delivered up, or its va lue fixed, the creditor shall not be allowed to prove any part of his debt, but the assignee shall deliver to COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 32the creditor all such property upon which the creditor holds a mort gage, pledge, or lien, or upon which he has an attach ment or execution. SOUR CE: CCP § 1356. § 50357. Creditor W aives Rights of Action.

editor all such property upon which the creditor holds a mort gage, pledge, or lien, or upon which he has an attach ment or execution. SOUR CE: CCP § 1356. § 50357. Creditor W aives Rights of Action. No creditor, proving his debt or claim, shall be allowed to maintain any suit therefor against the debtor , but shall be deemed to have waived all right of action and suit against him, and all pro ceedings already commenced or any unsatis fied judg ment already obtained thereon shall be deemed to be discharged and surrendered there by; and after the debtor's discharge, upon proper application and proof to the court having jurisdiction, all such proceedings shall be dis missed, and such unsatisfied judgments satisfied of record; provid ed, that no valid lien existing in good faith thereunder shall be thereby affect ed. A creditor proving his debt or claim shall not be held to have waived his right of action or suit against the debtor when a discharge has been refused or the proceedings have been determined without discharge. No creditor whose debt is provable under this Chapter shall be allowed, after the commencement of proceedings in insolvency , to prosecute to final judgment any

ave been determined without discharge. No creditor whose debt is provable under this Chapter shall be allowed, after the commencement of proceedings in insolvency , to prosecute to final judgment any action therefor against the debtor until the question of debtor's discharge shall have been determined, and any such suit or proceeding shall, upon the application of the debtor or of any creditor, or the assignee be stayed t o await the determi nation of the court on the question of discharge; provided, that if amount due the creditor is in dispute, the suit, by leave of the court in insolvency , may proceed to judgment for the purpose of ascertaining the amount due, which amou nt, when adjudged, maybeallowed in the insolvency proceedings, but execution shall be stayed as aforesaid. SOURCE: CCP § 1357. § 50358. Creditors Accepting Preference May not Prove. Any person who shall have accepted any preference, having reasonable cause to believe that the same was made or given by the debtor contrary to any provision of this Chap ter, shall not be allowed to prove the debt or claim on account of which the preference was made or given, nor shall he receive any dividend thereon, unti l he

contrary to any provision of this Chap ter, shall not be allowed to prove the debt or claim on account of which the preference was made or given, nor shall he receive any dividend thereon, unti l he shall have surrendered to the assignee all property , money , benefit or advan tage received by him under such preference. SOURCE: CCP § 1358. § 50359. Examination of the Debtor . COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 33The court may , upon the application of the assignee, or of any creditor , or without any application, before or after adjudication in insolvency , examine upon oath the debtor in relation to his property and estate and may examine any other person tender ing or making proof of the claims, and m ay subpoe na witnesses to give evi dence relating to such matters. All examination of witnesses shall be had and depositions shall be taken in accor dance with and in the same manner as is provid ed in other cases by this Code. SOURCE: CCP § 1359. ---------- ARTICLE 9 COMPOSI TIONS § 50400. Compositions: When and How Made. § 50401. Hearing and Confirmation. § 50400. Compositions: When and How Made.

other cases by this Code. SOURCE: CCP § 1359. ---------- ARTICLE 9 COMPOSI TIONS § 50400. Compositions: When and How Made. § 50401. Hearing and Confirmation. § 50400. Compositions: When and How Made. An insolvent debtor may offer terms of composi tion to his creditors after, but not before, he has filed in court a schedule of his prope rtyand list of his creditors as provid ed in this Chapter. An application for the confirmation of a composi tion may be filed in insolvency court after, but not before, it has been accepted in writing by a majority in number of all creditors whose claims have been allowed, which number must represent a majority in amount of such claims and after the consideration to be paid by the insolvent debtor to his creditors and the money necessary to pay all debts which have priority and the costs of proceedings hav e been deposited in such place as shall be designated by and subject to the order of the court. SOURCE: CCP § 1360. § 50401. Hearing and Confirmation. A time shall be fixed by the court for the hearing upon an application for the confirmation of a compo sition, and for the hearing of such objections as may be made to its confirmation.

Confirmation. A time shall be fixed by the court for the hearing upon an application for the confirmation of a compo sition, and for the hearing of such objections as may be made to its confirmation. The court shall confirm a composition if satisfied that (1) it is for the best interest of the creditors; (2) that the insolvent debtor has not been guilty of any of the ac ts, or of a failure to perform any of the duties which would create a bar to his dis - charge; and (3) that the offer and its accep tance are in good faith, and have COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 34not been made or procured except as herein provided, or by any means, promises, or acts here in forbidden. Upon the confirmation of a c omposition, the consideration shall be distributed as the judge directs, and the case dismissed, and the title to the insolvent debtor's property shall reve st in him. Whenever a composi tion is not confirmed, the e state in insolvency shall be administered as herein provided. The court may , upon applica tion of a party in interest, filed at any time within six (6) months after the composition has been confirmed, set the same aside, and rein state the case if it

provided. The court may , upon applica tion of a party in interest, filed at any time within six (6) months after the composition has been confirmed, set the same aside, and rein state the case if it shall bemade to appear upon a trial that fraud was practiced in the procuring of such composition, and that the knowledge thereof has come to the petitioner since the confirmation of such composition. SOURCE: CCP § 1361. ---------- ARTICLE 10 DISCHARGE §50450. Application for Discharge by Debtor. § 50451. When Not to be Granted; When V alid. § 50452. Creditor to File Objections. § 50453. Form of Discharge. § 50454. No Discharge Created by Fraud or Em bezzle ment. § 50455. Effect of Discharge. § 50450 . Application for Discharge by Debtor . At any time after the expiration of three (3) months from the adjudication of insolvency , but not later than one (1) year from such adjudica tion, unless the property of the insolvent debtor has not been converted in to money , the debtor may apply to the court for a discharge from his debts, and the court shall thereupon order notice to be given to all creditors who have proved their debts to appear on a day appointed for that purpose and show

to the court for a discharge from his debts, and the court shall thereupon order notice to be given to all creditors who have proved their debts to appear on a day appointed for that purpose and show cause why a dis charge sh ould not be granted to the debtor; said notice shall be given by registered mail and by publication at least once a week for six (6) weeks; provided, that if no debts have been proven, such notice shall not be required. SOURCE: CCP § 1364. § 50451. When Not to be Granted; When V alid. No discharge shall be granted, or if granted, no discharge will be valid:COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 351. If the debtor shall have sworn falsely in the affidavit anne xed to his petition, schedule, or invento ry, or upon any examina tion in the course of the proceedings in insolvency , in relation to any material fac t concerning his estate or his debts or to any other material fact; or 2. If he has concealed any part of his estate or effects, or any books or writing relating thereto; or 3. If he has been g uilty of fraud or willful neglect in the care or custody of his property or in the delivery to the assignee of the property belonging to him at the time

iting relating thereto; or 3. If he has been g uilty of fraud or willful neglect in the care or custody of his property or in the delivery to the assignee of the property belonging to him at the time of the presentation of his pe tition and inventory , excepting such property as he is permitted to retain under the provisions of this Chapter; or 4. If, within one (1) month before the commence ment of such proceedings, he has procured his real estate, goods, moneys, or chattels to be attached or seized on execu tion; or 5. If he has destroyed, mutilated, al tered, or falsified any of his books, documents, papers, writings, or securities, or has made, or been privy to the making of, any false or fraudulent entry in any book of account or other document with intent to defraud his creditors; or 6. If he has give n any fraudulent prefer ence, contrary to the provisions of this Title, or has made any fraudulent payment, gift, transfer, conveyance, or assignment of any part of his property , or has admitted a false or fictitious debt against his estate; or 7. If, havi ng knowledge that any person has proven such false or fictitious debt, he has not dis closed the same to his assignee

y , or has admitted a false or fictitious debt against his estate; or 7. If, havi ng knowledge that any person has proven such false or fictitious debt, he has not dis closed the same to his assignee within one (1) month after such knowledge; or 8. If, being a merchant or tradesman, he has not kept proper books of account in Arabic nume rals and in accordance with the provisions of law; or 9. If he, or any other person on his account, or in his behalf, has influenced the action of any creditor , at any stage of the proceedings, byany pecuniary consid eration or obligation; or 10. If he ha s, in contemplation of becoming insol vent, made any pledge, payment, trans fer, assignment, or conveyance of any part of his property , directly or indirectly , absolute ly or conditionally , for the purpose of prefer ring any creditor or person having a cla im against him, or who is, or may be, under liability for him, or for the purpose of COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 36preventing the property from coming into the hands of the assignee, or of being distributed under this Title in satisfaction of his debts; or 11.

f COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 36preventing the property from coming into the hands of the assignee, or of being distributed under this Title in satisfaction of his debts; or 11. If he has been convicted of any misde meanor under this Title, or has been guilty of fraud, contrary to the true intent of this Title; or 12. In case of voluntary insolvency , has received the benefit of this or any other law of insolvency or bankruptcy within six (6) years next p receding his application for discharge; or 13. If insolvency proceedings in which he could have applied for a discharge are pend ing by or against him in the court. Before any discharge is granted, the debtor shall take and subscribe an oath to the effect that he has not done, suffered, or been privy to any act, matter , or thing specified in this Chapter as grounds for withholding such discharge or as invali dating such discharge, if granted. SOURCE: CCP § 1365. § 50452. Creditor to File Objections. Any creditor opposing the discharge of a debtor shall file his objections thereto, specifying the grounds of his opposition, and after the debtor has filed and served his answer thereto, which pleading shall be

r opposing the discharge of a debtor shall file his objections thereto, specifying the grounds of his opposition, and after the debtor has filed and served his answer thereto, which pleading shall be verified, the court shall try the issue or issues raised, according to the practice provided bylaw in civil actions. SOURCE: CCP § 1366. § 50453. Form of Discharge. If it shall appear to the court that the debtor has in all things conformed to his duty under this Chapter , and that he is entitled under the provisions thereof to receive a discharge, the court shall grant him a discharge from all his debts, except as herein after provided, and shall give him a certificate thereof, under the seal of the court, in sub stance as follows: In the Superior Cour t, Guam. Whereas, _____________ has been duly adjudged insol vent under the insolvency law of Guam, and appears to have conformed to all the require ments of law in that behalf, it is therefore ordered by the court that said ______________ be forever dis charged from all debts and claims, which by said insolvency law are made provable against his estate, and which existed on the _________ day of ____, on which the petition of

_________ be forever dis charged from all debts and claims, which by said insolvency law are made provable against his estate, and which existed on the _________ day of ____, on which the petition of COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 37adjudication was filed by (or against) him, excepting such debts, if any , as are by said insolvency law excepted from the operation of a discharge in insolven cy. Given under my hand, and the seal of the court, this ______ day of ________, 19___ Attest:_______________________, Clerk. (SEAL) _______________________, Judge. SOURCE: CCP § 1367. § 50454. No Discharge Created by Fraud or Embezzle ment. No debt created by the fraud or embezzlement of the debtor , or by his defalcation as a public officer or while acting in a fiduciary capacity , shall be discharged under this Chap ter, but the debt may be proved, and the dividend thereon shall be a payment on account of said debt. No discharge granted under this Chapter shall release, dis charge, or affect any person liable for the same debt, for or with the debtor , either as partner, joint contractor , endorser , surety , or otherwise. SOURCE: CCP § 1368. § 50455. Effect of Discharge.

arge, or affect any person liable for the same debt, for or with the debtor , either as partner, joint contractor , endorser , surety , or otherwise. SOURCE: CCP § 1368. § 50455. Effect of Discharge. A discharge, duly granted under this Title, shall, with the exceptions aforesaid, release the debtor from all claims, debts, liabilities, and demands set fort h in his schedule, or which were or might have been proved against his estate in an insolvency , and may be pleaded by a simple averment that on the day of its date such discharge was grant ed to him, setting forth the same in full, and the same shall be a complete bar to all suits brought on any such debts, claims, liabilities, or demands, and the certificate shall be prima facie evidence in favor of such fact and of the regu larity of such discharge; provided however, that any creditor whose debt was prove d or provable against the estate in insolvency who shall see fit to contest the validity of such discharge on the ground that it was fraudulently obtained and who has discovered the facts constituting the fraud subsequent to the discharge, m ay, at any time within one (1) year after the date thereof, apply to the court which

t was fraudulently obtained and who has discovered the facts constituting the fraud subsequent to the discharge, m ay, at any time within one (1) year after the date thereof, apply to the court which granted it to set it aside and annul it. SOURCE: CCP § 1369. COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 38---------- ARTICLE 11 FRAUDULENT PREFERENCES AND TRANSFERS § 50500. Transfers, Etc., Defraud Creditors. § 50500. T ransf ers, Etc., Defraud Creditors. If any debtor being insolvent, or in contempla tion of insolvency , within thirty (30) days before the filing of a petition by or against him, with a view to giving a preference to any credi tor or person having a claim agains t him or who is under any liability for him, procures any part of his property to be attached, sequestered, or seized on execu tion, or makes any payment, pledge, mortgage, assignment, transfer, sale, or conveyance of any part of his property , either direc tlyor indirectly , absolutely or conditional ly, to anyone, the person receiving such pay ment, pledge, mortgage, assignment, transfer, sale or conveyance, or to be benefited thereby , or by such attachment or seizure, having rea sonable cause to

, to anyone, the person receiving such pay ment, pledge, mortgage, assignment, transfer, sale or conveyance, or to be benefited thereby , or by such attachment or seizure, having rea sonable cause to believe th at such debtor is insolvent, and that such attach ment, sequestration, seizure, payment, pledge, mort gage, conveyance, transfer , sale, or assignment is made with a view to prevent his property from coming to his assignee in insolvency , or to present the s ame from being distributed ratably among his creditors, or to defeat the object of, or in any way hinder, impede, or delay the operation of or to evade any of the provisions of this title, such attachment, sequestration, sei zure, payment, pledge, mortgage , transfer, sale, assignment, or conveyance is void, and the assignee, or the receiver, may recover the property , or the value thereof, as assets of such insolvent debtor . If such payment, pledge, mortgage, convey ance, sale, assignment, or transfer is not made in the usual and ordinary course of business of the debtor, or if such seizure is made under a judgment which the debtor has confessed or offered to allow , that fact shall be prima facie evidence of fraud.

usual and ordinary course of business of the debtor, or if such seizure is made under a judgment which the debtor has confessed or offered to allow , that fact shall be prima facie evidence of fraud. Any payment, pledge, mortgage, conveyance, sale, assignment, or transfer of property of whatever character made by the insolvent within one (1) month before the filing of a petition in insolvency by or against him, except for a valuable pecuniary consideration made in good faith, shall be void.COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 39Allassignments, transfers, conveyances, mortgages, or encumbrances of real estate shall be deemed under this section, to have been made at the time the instrument conveying or affecting such realty was filed for record in the Depart ment of Land Management. SOURCE: CCP § 1370. ----------- ARTICLE 12 MISCELLANEOUS § 50550. Death of Debtor. § 50551. Statute of Limitations, When Not to Run. § 50552. Creditor May be Represented by Attorney . § 50553. Exemption for Certain Property . § 50554. Insolvency Pr oceedings, When Deemed Commenced. § 50555. Receivers. § 50556. Attachment. § 50557. Costs. § 50558. Dismissal. § 50559. Appeal to Supreme Court.

xemption for Certain Property . § 50554. Insolvency Pr oceedings, When Deemed Commenced. § 50555. Receivers. § 50556. Attachment. § 50557. Costs. § 50558. Dismissal. § 50559. Appeal to Supreme Court. § 50550. Death of Debtor . If any debtor shall die after the order of adjudication, the proceed ings shall be contin ued and concluded in like manner and with like effect and validity as if he had lived. SOURCE: CCP § 1372. § 50551. S tatute of Limitations, When Not to Run. Pending insolvency proceedings by or against any pe rson, partnership, associati on, or corporation, no statute of limitations shall run upon a claim of or against the estate of the debtor . SOURCE: CCP § 1373. § 50552. Creditor May be Represented by Attorney. Any creditor, at any stage of the proceedings, may be represent ed by his attorney or duly authorized agent, and the attorney or agent, properly authorized, shall be entitled to vote at any creditors' meeting as and for his principal. COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 40SOURCE: CCP § 1374. § 50553. Exemption for Certain Property. It shall be the duty of the cou rt having jurisdiction of the proceedings, upon petition and after hearing, to

EDURE CH.50INSOLVENCY LAW 40SOURCE: CCP § 1374. § 50553. Exemption for Certain Property. It shall be the duty of the cou rt having jurisdiction of the proceedings, upon petition and after hearing, to exempt and set apart, for the use and benefit of said insolvent, such real and personal property as is by law exempt from execution, and also a homestead; but no such petition s hall be heard as aforesaid until it is first proved that notice of the hearing of the application therefor has been duly given by the clerk, by causing such notice to be posted in at least three public places in the town or city at least ten (10) days prio r to the time of such hearing, which notice shall set forth the name of said insolvent debtor , and the time and place appointed for the hearing of such application, and shall briefly indicate the homestead sought to be exempted or the property sought to be set aside; and the decree must show that such proof was made to the satisfaction of the court, and shall be conclusive evidence of that fact. SOURCE: CCP § 1375. § 50554. Insolvency Proceedings, When Deemed Commenced.

decree must show that such proof was made to the satisfaction of the court, and shall be conclusive evidence of that fact. SOURCE: CCP § 1375. § 50554. Insolvency Proceedings, When Deemed Commenced. The filing of a petition by or aga inst a debtor upon which or upon an amend ment of which an order of adjudication in insol vency may be made, shall be deemed to be the commencement of proceedings in insolvency under this Chapter . SOURCE: CCP § 1376. § 50555. Receivers. Upon the filing of either a voluntary or involuntary petition in insolven cy, a receiver may be appointed by the court in which the proceeding is pending, at any time before the election of an assignee, when it appears by the verified petition of a creditor that the asset s of the insolvent, or a consider able portion thereof, have been pledged, mort gaged, transferred, assigned, conveyed, or seized, on legal process, in contravention or violation of the provisions of § 50500 of this Chapter, and that it is necessary to com mence an action to recover the same. The appointment, oath, undertaking, and powers of such receiver shall in all respects be regulated by the laws of Guam applicable to receivers.

s necessary to com mence an action to recover the same. The appointment, oath, undertaking, and powers of such receiver shall in all respects be regulated by the laws of Guam applicable to receivers. When an assignee is chosen, and has qualified, the receivers shall forthwit h return to court an account of the assets and property which have come into his possession, and of his disbursements, and a report of all actions or proceedings commenced by him for the recovery of any property belong ing COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 41to the estate, and the court shal l thereupon summarily hear and settle the receiver's account, and shall allow him a just compensation for his service and his expenses, including a reasonable attorney's fee, whereupon the receiver shall deliver all property , assets, or effects remaining i n his hands, to the assignee who shall be substituted for the receiver in all pending actions or proceedings. SOURCE: CCP § 1377. § 50556. Attachment. When an attachment has been made and is not dissolved before the commencement of proceedings in insol vency , or is dissolved by an undertak ing given by the defen dant, if the claim upon which the

. When an attachment has been made and is not dissolved before the commencement of proceedings in insol vency , or is dissolved by an undertak ing given by the defen dant, if the claim upon which the attachment suit was commenced is proved against the estate of the debtor, the plaintiff mayprove the legal costs and disbursements of the suit, and of the keepi ng of the property , and the amount thereof shall be a preferred debt. SOURCE: CCP § 1378. § 50557. Costs. In all contested matters in insolvency the court may , in its discretion, award costs to either party to be paid by the other , or to either or both parties to be paid out of the estate, as justice and equity may require. In awarding costs, the court may issue execution therefor . In all involuntary cases under this Title, the court shall allow the peti tioning creditors out of the estate of the debtor ,if any adjudication of insolvency be made, as a preferred claim, all legal costs and disburse ments incurred by them in that behalf. SOURCE: CCP § 1379. § 50558. Dismissal. If no creditor files written objection, the court may , upon the application of the debtor , if it be a voluntary petition, or of the petitioning

that behalf. SOURCE: CCP § 1379. § 50558. Dismissal. If no creditor files written objection, the court may , upon the application of the debtor , if it be a voluntary petition, or of the petitioning creditors if a creditor's petition, dismiss the petition and discontinue the proceed ings at any time before the appointment of an assignee, upon giving not less than two (2) weeks nor more t han three (3) months notice to the creditors, in the same manner that notice of the time and place of election of an assignee is given; provided however, that by written con sent of all creditors filed in the court the pro ceedings may be dismissed at any time. After the appointment of an assignee, no dismissal shall be made without the consent of all parties interested in or affected thereby . COL1201067GCA CIVIL PROCEDURE CH.50INSOLVENCY LAW 42SOURCE: CCP § 1380. § 50559. Appeal to Supreme Court. An appeal may be taken to the Supreme Court in the follow ing cases: 1. From an order granting or refusing an adjudica tion of insolvency and, in the latter case, from the order fixing the amount of costs, expenses, damages, and attorney's fees allowed the debtor; 2.

1. From an order granting or refusing an adjudica tion of insolvency and, in the latter case, from the order fixing the amount of costs, expenses, damages, and attorney's fees allowed the debtor; 2. From an order made at the hearing of any acco unt of an assignee, allowing or rejecting a cred itor's claim, in whole or in part, when the amount in dispute exceeds three hundred dollars ($300.00); 3. From an order allowing or denying a claim for property not belonging to the insol vent presented und er § 50250 of this Chapter; 4. From an order settling an account of an assign ee; 5. From an order against or in favor of setting apart homestead or other property claimed as exempt from execution; [or] 6. From an order granting or refusing a discharge to the debtor . The provisions of this Title shall govern appeals under this Chapter , except that when an assignee has given an official undertaking and appeals from a judgment or order in insolvency , his official undertaking stands in the place of an unde rtaking on appeal, and the sureties thereon are liable on such undertaking; provided howev er, that an interlocutory appeal shall not stayproceedings unless a written undertaking be

place of an unde rtaking on appeal, and the sureties thereon are liable on such undertaking; provided howev er, that an interlocutory appeal shall not stayproceedings unless a written undertaking be entered into on the part of the appellant, with at least two sureties, in such an amount as the court may direct, but not less than double the value of the property involved, to the effect that if the order ap pealed from be affirmed, or the appeal dismissed, appellant will pay all costs and damages which the adverse party may sus- tain by reason of the appeal and the stay of proceedings. SOURCE: CCP § 1381. Reenacted by P .L. 21 -147 (eff. 5/1/93). NOTE: This section was amended by P .L. 12 -85 to direct all appeals to the Supreme Court of Guam. It was reenacted by P .L. 21 -147 to r eflect the post -Olsen Supreme Court of Guam. ----------