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Full-Text Articles in Law
Milking The Estate, David R. Hague
Milking The Estate, David R. Hague
Faculty Articles
Recent Chapter 7 bankruptcy cases are exposing a widespread problem. Chapter 7 trustees are retaining their own law firms to represent them and then in clear breach of their fiduciary duties to creditors-requesting illegitimate legal fees to be paid by the estate. This practice is immoral and particularly harmful to creditors. Indeed, every dollar paid to the trustee and his firm is a dollar that will not be distributed to creditors. The Bankruptcy Code, remarkably, allows a trustee to retain his own law firm to represent him in his capacity as a trustee. But this inherently conflicted arrangement is not …
Check Clearing And Voidable Preference Law Under The Bankruptcy Code, David G. Carlson
Check Clearing And Voidable Preference Law Under The Bankruptcy Code, David G. Carlson
Faculty Articles
Every business practice must withstand the critique of federal voidable preference law. This article surveys how well check clearing system fares under this adjunct to the principle that unsecured creditors should share equally in a bankruptcy proceeding. Check clearing involves extending short-term credit by depositary banks to their customers. Banks routinely extend unsecured and secured credit. The fate of a bank in its customer's bankruptcy differs, depending on what kind of credit is extended. In the case of an overdraft, banks have preference risk, but they also have powerful defenses to muster against liability. In the case credit is advanced …
Sare Manipulation: The Hurdles In Single-Asset Real Estate Cases, David R. Hague
Sare Manipulation: The Hurdles In Single-Asset Real Estate Cases, David R. Hague
Faculty Articles
Under § 1129(a)(10) of the Bankruptcy Code, a debtor's plan of reorganization cannot be confirmed unless at least one "impaired class" accepts the plan, excluding acceptance of any insider of the debtor. A class of claims accepts the plan if more than one-half in number and at least two-thirds in amount of claims voting in a class favor the plan. Thus, a debtor's composition of its classes clearly has a substantial impact upon its chances of successfully confirming its plan of reorganization over dissenting creditors. Obviously, the debtor would like to have unfettered power and full discretion to group creditors …