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Full-Text Articles in Law
Livingstone Motor Assemblers Limited (In Receivership) V Indeco Estates Development Company And Others (Supreme Court Judgment No. 1 Of 2013), Ntemena Mwanamwambwa
Livingstone Motor Assemblers Limited (In Receivership) V Indeco Estates Development Company And Others (Supreme Court Judgment No. 1 Of 2013), Ntemena Mwanamwambwa
SAIPAR Case Review
The appeal stems from a winding-up petition filed in the High Court by the respondents seeking an order to commence winding-up proceedings as well as the appointment of a liquidator in respect of the appellant, Livingstone Motor Assemblers Limited. The latter was heavily indebted to several creditors, including the respondents and the Zambia National Commercial Bank (ZANACO) which had commenced receivership proceedings and appointed a receiver/manager extra judiciously, prior to the High Court granting the winding-up order. Disgruntled by the grant of the order, the receiver/manager made an application to vary it so that only he would retain possession of …
Resolving Corporate Insolvencies In China: The Gap Between Law And Reality, Dr. Zhang Zinian
Resolving Corporate Insolvencies In China: The Gap Between Law And Reality, Dr. Zhang Zinian
University of Miami International and Comparative Law Review
This article examines how corporate insolvencies in China, the second largest economy, are handled under the current legislation, the China Enterprise Bankruptcy Law of 2006. Relying on the fresh empirical data arising from the first ten years on the use of China’s three insolvency procedures, reorganization, composition and liquidation, this article reveals the huge gap between the law in the books and the law in action, arguing that the implementation of this law in China perhaps has not achieved the legislative objectives. The constitutional and institutional weaknesses affecting the application of this law are analyzed
The Lehman Brothers Bankruptcy E: The Effects On Lehman’S U.S. Broker-Dealer, Rosalind Z. Wiggins, Andrew Metrick
The Lehman Brothers Bankruptcy E: The Effects On Lehman’S U.S. Broker-Dealer, Rosalind Z. Wiggins, Andrew Metrick
Journal of Financial Crises
Lehman’s U.S. broker-dealer, Lehman Brothers Inc. (LBI), was excluded from the parent company’s bankruptcy filing on September 15, 2008, because it was thought that the solvent subsidiary might be able to wind down its affairs in a normal fashion. However, the force of the parent’s demise proved too strong, and within days, LBI and dozens of Lehman subsidiaries around the world were also in liquidation. As a regulated broker-dealer, LBI was required to comply with the Securities and Exchange Commission financial-responsibility rules for broker-dealers, including maintaining customer assets separately. However, the corporate complexity and enterprise integration that characterized the Lehman …
Ten Years After Consumer Bankruptcy Reform In The United States: A Decade Of Diminishing Hope And Fairness, Robert J. Landry Iii
Ten Years After Consumer Bankruptcy Reform In The United States: A Decade Of Diminishing Hope And Fairness, Robert J. Landry Iii
Catholic University Law Review
The tenth anniversary of the effective date of Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (Reform Act), the largest reform to the consumer bankruptcy in the United States in a quarter of a century, will be marked in October of 2015. Prior to, and since its passage, scores of scholars have theorized about the impact of the Reform Act. The vast majority of research since its passage shows that the Reform Act has not had a long-term impact on filing rates. With this backdrop, the paper explores how the virtues of fairness for creditors and hope for individuals …
Orderly Liquidation Authority: A New Insolvency Regime To Address Systemic Risk, Hollace T. Cohen
Orderly Liquidation Authority: A New Insolvency Regime To Address Systemic Risk, Hollace T. Cohen
University of Richmond Law Review
No abstract provided.
The Success Of Chapter 11: A Challenge To The Critics, Elizabeth Warren, Jay Lawrence Westbrook
The Success Of Chapter 11: A Challenge To The Critics, Elizabeth Warren, Jay Lawrence Westbrook
Michigan Law Review
Although Chapter 11 has served as a model for bankruptcy reform around the world, the conventional wisdom has been that it is characterized by a relatively low success rate and endless delay. The data from large samples of Chapter 11 cases filed in 1994 and 2002 demonstrate that this characterization is wrong. Nearly all troubled companies choose Chapter 11 over Chapter 7 liquidation, which means that the system serves a critical screening function to eliminate hopeless cases relatively quickly. Almost half the unsuccessful cases were jettisoned within six months and almost eighty percent were gone within a year The cases …
Bankruptcy-Test Of Feasibility Under Chapter Xi Arrangement, Paul B. Campbell S.Ed.
Bankruptcy-Test Of Feasibility Under Chapter Xi Arrangement, Paul B. Campbell S.Ed.
Michigan Law Review
The Slumberland Bedding Company started in business in 1952 with a capitalization of $13,000. Within less than one year the corporation was "clearly heavily insolvent," having debts in excess of $85,000 and assets valued "at least several thousand dollars less than $42,250." Preferred creditor claims against the assets of the business amounted to more than $32,200. In this rather dismal context a petition for an arrangement under chapter XI of the Bankruptcy Act was filed. A plan was submitted which provided for independent capital to be put into the business to pay certain claims in full and to pay a …
Insolvent Decedents' Estates, Kurt H. Nadelmann
Insolvent Decedents' Estates, Kurt H. Nadelmann
Michigan Law Review
The problems of insolvent decedents' estates have created special difficulties in all legal systems. Two unrelated fields of the law are involved: decedents' estates and insolvency. Treatment of the topic in works on one or the other field is often scanty and few studies exist which deal exclusively with insolvent decedents' estates law. Research in the conflicts problems of the field has led the writer to investigate the differences in the treatment of insolvent decedents' estates in this country, other common law countries, and countries of the civil law. Results of this study are used to discuss problems of the …
Bankruptcy-The New Test Of Perfection Under Section 60a-Effect Of Public Law 461, William R. Worth S.Ed.
Bankruptcy-The New Test Of Perfection Under Section 60a-Effect Of Public Law 461, William R. Worth S.Ed.
Michigan Law Review
A preference given to a creditor by an insolvent debtor is not a fraud on his other creditors, regardless of the fact that such payment reduces the share that they would be able to obtain upon an orderly liquidation and pro rata distribution of his estate. This simple principle has caused great confusion and trouble in the development of collective procedures for the satisfaction of the claims of creditors. It led through various channels to a very sweeping definition of preferences and provision for their avoidance in the Chandler Act of 1938, and has now produced, by a process of …
Corporations-Extent Of Powers To Dispose Of Property In Winding Up Its Affairs Under Statutes Extending Corporate Existence, Joseph R. Brookshire S.Ed.
Corporations-Extent Of Powers To Dispose Of Property In Winding Up Its Affairs Under Statutes Extending Corporate Existence, Joseph R. Brookshire S.Ed.
Michigan Law Review
According to the common law a dissolved corporation ceased to exist for all purposes. Whether the dissolution was voluntary or involuntary, the effect of the dissolution was to deprive the corporation of all powers either de jure or de facto. It was necessary, therefore, that corporations facing dissolution proceed without delay toward a final liquidation and distribution of assets. Disregarding the old theory that personal property of dissolved corporations escheated to the state, and that its real estate reverted to the original granter or his heirs, and that debts due the corporation were extinguished, it is still apparent that hurried …
Banks And Banking - Immunity Of National Banks From State Escheat Statute, Spencer E. Irons
Banks And Banking - Immunity Of National Banks From State Escheat Statute, Spencer E. Irons
Michigan Law Review
A Michigan statute provided that bank deposits, in the possession or control of insolvent banks, which have remained inactive for a period of seven years or more shall escheat to the state. In a suit for a declaratory judgment, filed by the Attorney General of Michigan, against the receiver of an insolvent national bank and the Comptroller of the Currency of the United States, the federal district court held that the receiver must turn over deposits coming within the terms of the statute. Held, the statute is invalid if so applied, since it would constitute an unlawful interference with …
Holding Company Act - "Fair And Equitable" Plan, Michigan Law Review
Holding Company Act - "Fair And Equitable" Plan, Michigan Law Review
Michigan Law Review
Should the words "fair and equitable" in section II (e) of the Holding Company Act be construed differently than the same words in section 77 B of the Bankruptcy Act? The Securities and Exchange Commission faced this question in disposing of a proposed plan of merger involving Utility Operators Company and subsidiaries. A divided commission gave an affirmative answer to the above question, holding "fair and equitable" in the Holding Company Act to permit relative priority. This holding merits particular interest since the United States Supreme Court has held the same words as used in section 77B permitted only absolute …
Bankruptcy - Amenability Of Farmers' Marketing Co-Operatives To Involuntary Proceedings, Kenneth J. Nordstrom
Bankruptcy - Amenability Of Farmers' Marketing Co-Operatives To Involuntary Proceedings, Kenneth J. Nordstrom
Michigan Law Review
Creditors of the Wisconsin Cooperative Mille Pool filed a petition asking that the milk pool be adjudicated an involuntary bankrupt. This co-operative association was organized under Wisconsin statutes to operate on a nonstock, nonprofit basis as the exclusive marketing agent for its members. The pool also marketed the products of patrons who were not members of the pool; however, sixty-five per cent of its patrons were active members. Held, the association was not a "moneyed, business, or commercial corporation" and hence was not amenable to adjudication as an involuntary bankrupt/ despite the fact that it was engaged in business …
Glenn On Fraudulent Conveyances And Preferences, Fred T. Hanson
Glenn On Fraudulent Conveyances And Preferences, Fred T. Hanson
Michigan Law Review
Professor Glenn's new two volume work on Fraudulent Conveyances and Preferences is much more than a revised edition of his previous book. The treatment of preferences is new and the material in the old book is revised and expanded. This expansion is particularly evident in his dealing with commercial financing devices--consignments, trust receipts, after-acquired property clauses, and freehanded mortgages of goods and accounts--which he now views also from the standpoint of preference.
Trusts - Constructive Trusts - Preferential Claim Against Bank's Assets For Deposits Made After Hopeless Insolvency, James W. Deer
Trusts - Constructive Trusts - Preferential Claim Against Bank's Assets For Deposits Made After Hopeless Insolvency, James W. Deer
Michigan Law Review
On proclamation by the governor of the so-called bank holiday, the Union Guardian Trust Company was closed as of February 11, 1933. The evidence showed that within nine months of closing the company had made provision for obtaining $2,500,000 by pledging assets, had received loans amounting to $12,000,000 from the Reconstruction Finance Corporation, and was conferring frequently with the officers of· that agency to negotiate an additional $44,000,000 loan. Under the authority of emergency legislation passed after the bank holiday, a conservator was appointed. By the plan of reorganization all the assets of the company were set aside in a …
Corporations - Derivative Suits - Insolvency As A Bar, Edmund O'Hare
Corporations - Derivative Suits - Insolvency As A Bar, Edmund O'Hare
Michigan Law Review
Plaintiff, stockholder in defendant bank, brought a derivative suit against the bank's directors to recover moneys allegedly wrongfully appropriated by them from the bank's assets. Before the commencement of the suit the bank had become insolvent and was in the process of liquidation. Held, the directors' motion to dismiss should be granted, since a stockholder may not maintain an action to hold an insolvent corporation's directors liable for fraud or mismanagement unless it appears that he will be benefited by the relief demanded, and full recovery here would still leave an excess of liabilities over assets. Falvey v. Foreman-State …
Torts - Negligent Misrepresentations - Information Gratuitously Supplied, Michigan Law Review
Torts - Negligent Misrepresentations - Information Gratuitously Supplied, Michigan Law Review
Michigan Law Review
Plaintiffs, who were liquidating trustees of a building and loan association, alleged that the association requested defendant to send it a copy of a certain will, but that defendant, who was trustee under the will, sent the association a copy of another will. Since the testators bore the same name, the association did not realize the error, but relied on the copy and suffered a loss which it would not have suffered if it had known the true state of facts. Plaintiffs sued to recover the loss. Held, plaintiffs have not stated a cause of action, inasmuch as they …
Insolvency-The Co-Debtor As A Factor In Distribution, Fred T. Hanson
Insolvency-The Co-Debtor As A Factor In Distribution, Fred T. Hanson
Michigan Law Review
The problems in distribution peculiar to claims upon which another is liable with the insolvent have received little critical analysis in judicial decisions. This is largely because the chancery rule, governing the treatment of lienors, is widely accepted as the solution in every instance where one creditor has an exclusive resource from which he may obtain payment wholly or in part.
Bankruptcy - Recovery Of Preferences - Requirement That Defendant Be Paid A Greater Percentage Of His Claim Than Other Creditors
Michigan Law Review
In a suit by the trustee in bankruptcy to recover as preferences part payments to defendant within four months of bankruptcy, the trial court refused to rule that the trustee had the burden of proving that each payment had the effect of giving to the defendant a greater percentage of his claim than other creditors would have received if the estate had been liquidated at that time. Held, the court's refusal was proper. Palmer Clay Products Co. v. Brown, 297 U.S. 227, 56 S. Ct. 450 (1936).
Banks And Banking-Constitutional Validity Of Statutes Allowing Reorganization Of Insolvent Bank
Banks And Banking-Constitutional Validity Of Statutes Allowing Reorganization Of Insolvent Bank
Michigan Law Review
A statute of Mississippi permitted the reopening of a closed bank, for the purpose of paying off creditors, upon terms proposed by three-fourths of the bank's creditors. The statute required that the proposition of the creditors be approved by the state superintendent of banks and confirmed by the court of chancery. Dissenting creditors opposed such a plan on the ground that the statute was unconstitutional because it impaired the obligation of contracts, and was contrary to the due process clause of the Federal Constitution. The court held that the statute was valid, that all it did was to change the …
Corporate Reorganization-Section 77 Of The Bankruptcy Act--Power Of Court To Enjoin Sale Of Bonds Pledged As Collateral
Michigan Law Review
The recent Chicago, Rock Island case raised an interesting problem under Section 77 of the Bankruptcy Act. The Chicago, Rock Island as parent railroad of a system extending into one-fourth of the states, had pledged large blocks of its own mortgage bonds and those of its subsidiaries, as security for loans made to it by the Reconstruction Finance Corporation and some Chicago, New York, and St. Louis banks, under an agreement whereby the pledgees were given a power of private sale, without notice, upon set contingencies. In addition to the above it had previously pledged with trustees as security for …
Constitutional Law - Bank Reorganization Legislation - Composition With Depositors And Other Creditors, Maurice S. Culp
Constitutional Law - Bank Reorganization Legislation - Composition With Depositors And Other Creditors, Maurice S. Culp
Michigan Law Review
Twenty States and the federal government now have laws permitting the reorganization and reopening of insolvent or failing banks. The usual statute provides for the reorganization of a bank upon some plan approved by a large majority of the general creditors of the institution; the plan must also have the approval of state banking officials and of a court of general jurisdiction, although the last is by no means a universal requirement. The reorganization, when approved, becomes binding upon all depositors and general creditors of the bank regardless of consent. By the terms of a few statutes, non-assenting creditors are …
Bank Reorganization And Recapitalization In Michigan, Ellis B. Merry
Bank Reorganization And Recapitalization In Michigan, Ellis B. Merry
Michigan Law Review
On January 2, 1933, 420 state and 68 national banks were operating in Michigan. On February 13, the Governor of Michigan proclaimed a banking holiday for eight days which was extended in effect on February 22. On March 4, the President proclaimed a national banking holiday until March 9. Under the provisions of the President's proclamation lifting the national banking holiday, 198 state and approximately 30 national banks were reopened by the appropriate authorities as "sound" banks. State bank conservators assumed the management and custody of 215 state banks which did not open, on appointment by the Commissioner of the …
Corporations - Dissolution - Distribution Of Assets Between Preferred And Common Stockholders
Corporations - Dissolution - Distribution Of Assets Between Preferred And Common Stockholders
Michigan Law Review
In periods of business depression, problems concerning the dissolution and liquidation of corporations, with the question of preference between the holders of the preferred and common stock, often become very acute. A recent case, presenting the question of preference from the aspect of unpaid dividends on preferred stock, is Penington v. Commonwealth Hotel Construction Corporation.
Claims Against The Creditor As Defenses To The Surety, H. W. Arant
Claims Against The Creditor As Defenses To The Surety, H. W. Arant
Michigan Law Review
In the absence of statutory provision, where the surety is sued alone, the generally accepted view is that he can not show the existence of a claim in favor of his principal against the creditor for the purpose of preventing or decreasing the creditor's recovery against him. The view has frequently been applied where the surety, sued alone, sought to set up the creditor's breach of warranty as a defense. It recognizes that such a breach of warranty gives rise to a cause of action against the creditor that belongs solely to the principal debtor. It also recognizes the possibility …