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The Wasted Sacrifice Of Lessors' Lost Profit Claims In Bankruptcy, Marie T. Reilly

Journal Articles

Bankruptcy Code section 502(b)(6) sets the maximum allowable amount of a real property lessor's claim for damages arising for breach of lease in a tenant's bankruptcy case. To the extent a lessor's damages claim under nonbankruptcy law exceeds the maximum amount, it is disallowed. The implicit premise for such disallowance is that real property lessors' damages claims are less worthy of respect in bankruptcy than other claims for damages against the debtor. Real property leases are legally distinct from leases of personal property or other contractual relationships that allocate property rights. But, it does not obviously follow from the distinction …