Question:

Mr. Debtor owes fifteen (15) persons substantial amounts of money. His financial situation indicates that his liabilities for exceed his assets. If Mr. Debtor cedes or assigns his properties to his creditors,

A.

The creditors acquire ownership of the properties assigned or ceded.

B.

The creditors shall sell the properties assigned and when sold, the debt of Mr. Debtor is deemed paid regardless of whether or not the net proceeds are equal to or less than the amount of the indebtedness.

C.

The creditors shall sell the properties assigned and when sold, the debt of Mr. Debtor shall only be released to the extent of the net proceeds of the sale.

D.

The cession or assignment shall extinguish the obligation whether or not the creditors sell the properties assigned.

Answer» c. The creditors shall sell the properties assigned and when sold, the debt of Mr. Debtor shall only be released to the extent of the net proceeds of the sale.