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We Can Work It Out: Entertaining A Dispute Resolution System Design For Bankruptcy Court, Elayne E. Greenberg
We Can Work It Out: Entertaining A Dispute Resolution System Design For Bankruptcy Court, Elayne E. Greenberg
Faculty Publications
On October 2, 2009, dispute resolution scholars and bankruptcy court jurists courageously began the difficult conversation about the feasibility of an expanded dispute resolution system design for bankruptcy court. This commentary distills that conversation through a dispute resolution system design lens. Dispute resolution system design offers a framework for organizations to more effectively manage and resolve recurring conflicts. The design of a dispute resolution system requires clarifying ideas, elucidating values, prioritizing goals, considering options and incorporating that information into a more workable process to respond to conflict. All the while, the stakeholders and dispute resolution designers work together to clarify, …
Bargaining Around Bankruptcy: Small Business Workouts And State Law, Edward R. Morrison
Bargaining Around Bankruptcy: Small Business Workouts And State Law, Edward R. Morrison
Faculty Scholarship
Federal bankruptcy law is rarely used by distressed small businesses. For every 100 that suspend operations, at most 20 file for bankruptcy. The rest use state law procedures to liquidate or reorganize. This paper documents the importance of these procedures and the conditions under which they are chosen using firm-level data on Chicago-area small businesses. I show that business owners bargain with senior lenders over the resolution of financial distress. Federal bankruptcy law is invoked only when bargaining fails. This tends to occur when there is more than one senior lender or when the debtor has defaulted on senior debt …