St. Paul bankruptcy filing lists $2.1 million in liabilities

Many Minnesota business owners know there are a lot of expenses that come with running a business. And, when the individual starts taking on some of these expenses -- if the business runs into financial troubles -- the owner can also find themselves in a bad financial spot.

Take for example the recent bankruptcy filing of Tony Sutton. While Sutton is more known in the Twin Cities political arena -- politics aside -- his story casts light on some of the financial struggles felt by others in Minnesota.

Sutton and his wife recently filed for Chapter 7 bankruptcy. In their filing, more than $2.1 million is listed in liabilities. With $296,000 listed in assets, it is no wonder the couple decided to file for bankruptcy.

In taking a closer look at their filing, in terms of liabilities, the debts listed are primarily business related. And, while some debts are listed in the filing, like owing $290,000 to Indianhead Food Service, others simply say "current amount of liability unknown."

In looking at business ventures, the couple was part owners of Baja Soul until 2011. They were part of an investor group that was led by the CEO of TCF Financial Corporation. This group acquired Baja Soul in 2006.

What is a Chapter 7 bankruptcy?

When talking about the Sutton bankruptcy, some might be wondering what exactly a Chapter 7 bankruptcy is.

In the simplest of terms, a Chapter 7 bankruptcy is a debt relief tactic used by those who realistically cannot pay back all they owe. A typical sign of this is when a person's budget only always them to pay their monthly living expenses, but not their other debts, like those from a credit card, business-related debts or medical bills.

With a Chapter 7 bankruptcy, many of these unsecured debts are discharged in order to give someone a fresh financial start. Many times, after a bankruptcy, the person who filed takes a long, hard look at their finances in order to determine what got them into their financial situation in order to avoid the same issues in the future.

Of course though, this is just a basic explanation of Chapter 7 bankruptcy. The ins and outs of filing can be much more confusing, which is where a bankruptcy attorney can step in. This attorney can walk a Twin Cities area resident through the bankruptcy process from start to finish.

Source: Twin Cities Business, "Former MN GOP Leader Sutton Files For Bankruptcy," Burl Gilyard, Sept. 3, 2013

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