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Full-Text Articles in Law

Bankruptcy’S Uneasy Shift To A Contract Paradigm, David A. Skeel Jr., George Triantis Jan 2018

Bankruptcy’S Uneasy Shift To A Contract Paradigm, David A. Skeel Jr., George Triantis

Faculty Scholarship at Penn Law

The most dramatic development in twenty-first century bankruptcy practice has been the increasing use of contracts to shape the bankruptcy process. To explain the new contract paradigm—our principal objective in this Article-- we begin by examining the structure of current bankruptcy law. Although the Bankruptcy Code of 1978 has long been viewed as mandatory, its voting and cramdown rules, among others, invite considerable contracting. The emerging paradigm is asymmetric, however. While the Code and bankruptcy practice allow for ex post contracting, ex ante contracts are viewed with suspicion.

We next use contract theory to assess the two modes of ...


The Duty To Creditors Reconsidered - Filling A Much Needed Gap In Corporation Law, Richard A. Booth Jan 2007

The Duty To Creditors Reconsidered - Filling A Much Needed Gap In Corporation Law, Richard A. Booth

Faculty Scholarship

The most fundamental question of corporation law is to whom does the board of directors of a corporation owe its fiduciary duty. Recently, the question has tended to be whether and under what circumstances the board of directors has the duty to maximize stockholder wealth. But if a corporation is insolvent (or close to it), business decisions designed to maximize stockholder wealth may result in a reduction of creditor wealth. Although the conventional wisdom is that creditors must protect themselves by contractual means, there is a substantial body of case law that says that creditors can assert claims sounding in ...