Bankruptcy Law Commons^™

Bankruptcy In The Seventh Circuit: 1993, Douglass Boshkoff

Articles by Maurer Faculty

No abstract provided.

Should We Abolish Chapter 11? The Evidence From Japan, Theodore Eisenberg, Shoichi Tagashira

Cornell Law Faculty Publications

Optimizing reorganization proceedings for small and midsized businesses is an important issue in every industrial country. But little information exists about the actual operation of such proceedings. Recent U.S. bankruptcy studies focus either on consumer bankruptcies or on large Chapter 11 cases involving publicly listed firms. This article presents the results of a comprehensive empirical study of Japan's most frequently used business bankruptcy reorganization provision. Small and midsized reorganizations have become important for several reasons. First, unlike large firms, the vast majority of small businesses fail to obtain confirmation of a Chapter 11 plan and end up in liquidation, thus …

The Rehnquist Court, Strict Statutory Construction And The Bankruptcy Code, Carlos J. Cuevas

Cleveland State Law Review

This article analyzes the Rehnquist Court's use of strict statutory construction. It will argue that strict statutory construction can be justified under public choice and agency theories of statutory interpretation, and that strict construction promotes the implementation of bankruptcy policy. Strict statutory construction, moreover, is beneficial because it produces reliability and predictability, which is essential to our dynamic economy. The use of strict statutory construction precludes a court from relying on legislative history to manufacture the result that the court thinks is the best solution to the problem. Another justification for strict statutory construction is that it prevents bankruptcy judges …

Bankruptcy—Chapter 13—Bifurcation Of Undersecured Claims Secured Only By Residential Real Estate Mortgages Is Not Allowed. Nobelman V. American Savings Bank (In Re Nobelman), 113 S. Ct. 2106 (1993)., Steven O. Vondran

University of Arkansas at Little Rock Law Review

No abstract provided.

Bankruptcy—Property Of The Estate—The Property Of The Estate Continues To Exist After Confirmation Of The Chapter 13 Plan. Security Bank Of Marshalltown V. Neiman, 1 F.3d 687 (8th Cir. 1993)., Alexandra A. Ifrah

University of Arkansas at Little Rock Law Review

No abstract provided.

Epa Runs Cerclas Around Bankruptcy Law: In Re Cmc Heartland Partners, Catherine A. Barth

Villanova Environmental Law Journal (1991 - )

No abstract provided.

What Is Right About Bankruptcy Law And Wrong About Its Critics, Samuel Bufford

Faculty Scholarship

My comments in this paper focus on the papers in thus Symposium by Professors Barry Adler, James Bowers, and Philippe Aghion, Oliver Hart, and John Moore. I argue that the central points of these papers are gravely mistaken because they completely misunderstand the character of the bankruptcy caseload and procedures, they ignore some important purposes of bankruptcy reorganization, and they misstate the success rate for reorganizations. I have chosen these papers for comment for two reasons: they recommend radical changes in bankruptcy law, and they are based on the thinnest knowledge of bankruptcy practice. Incidentally, they also all take an …

Joint Tax Return Liability And Bankruptcy, Ann F. Thomas

Other Publications

No abstract provided.

Hail Britannia?: Institutional Investor Behavior Under Limited Regulation, John C. Coffee Jr., Bernard S. Black

Faculty Scholarship

A central puzzle in understanding the governance of large American public firms is why most institutional shareholders are passive. Why would they rather sell than fight? Until recently, the Berle-Means paradigm – the belief that separation of ownership and control naturally characterizes the modern corporation – reigned supreme. Shareholder passivity was seen as an inevitable result of the scale of modern industrial enterprise and of the collective action problems that face shareholders, each of whom owns only a small fraction of a large firm's shares.

A paradigm shift may be in the making, however. Rival hypotheses have recently been offered …

Lien Stripping After Nobelman, Jane K. Winn

Articles

This Article first examines the Supreme Court's holding in Nobelman. Part II reviews the various statutory interpretations and bankruptcy policy arguments marshaled by both debtors and creditors regarding the permissibility of stripping home mortgages under the Bankruptcy Code. Part III discusses the issue of lien stripping as addressed in the bankruptcy reform legislation introduced in Congress in 1992 and 1993. Part IV of this Article reviews other similar forms of debtor relief in order to evaluate creditors' claims that lien stripping would disrupt credit markets and impair the free flow of credit to borrowers. The forms of debtor relief …

Person Or Property? On The Legal Nature Of The Bankruptcy Estate, Stephen M. Mcjohn

Suffolk University Law School Faculty Works

This article addresses the legal nature of the bankruptcy estate: whether the bankruptcy estate is a collection of property interests, like the traditional conception of a decedent's estate, or whether the estate is the legal person in which such property interests vest, analogous to a corporation, a partnership, or an individual. The legal nature of the bankruptcy estate becomes most important when a corporation which files a chapter 11 petition becomes a debtor in possession. Suppose Acme Corporation files a chapter 11 bankruptcy petition and becomes a debtor in possession; Acme's property becomes the bankruptcy estate. What is Acme Corporation's …

Artificial Impairment And The Single Asset Chapter 11 Case, David G. Carlson

Articles

The article critiques the use of Chapter 11 bankruptcy for single asset real estate cases, arguing that the doctrine of artificial impairment undermines the purpose of Chapter 11 by allowing creditors to bypass valuation and unfairly dismiss cases without merit. It contends that the repeal of section 1124(3) in 1994 has created uncertainty about the viability of artificial impairment as a tactic, while courts and creditors continue to grapple with the classification and treatment of claims in these cases.

Developments In Trading Claims: Participations And Disputed Claims, Chaim J. Fortgang, Thomas Moers Mayer

Cardozo Law Review

The two years since our last paper on trading claims' have seen an explosion in the market for claims against Chapter 11 debtors. More institutions are involved in buying, selling, and brokering claims than ever before. Goldman, Sachs & Company, Salomon Brothers Inc., Lazard Freres & Company, Inc., and Kidder Peabody & Company have joined Oppenheimer & Company, and Bear, Stearns & Company as established Wall Street houses making markets in distressed claims. Commercial banks such as First National Bank of Chicago, ING Bank, and Citibank, N.A. now buy and sell bank claims against distressed debtors.

Bankruptcy Policymaking In An Imperfect World, Elizabeth Warren

Michigan Law Review

This essay is about bankruptcy policy. It attempts to articulate a comprehensive statement about the various and competing goals that underlie the bankruptcy system. The essay offers both a positive observation, drawn from the Code and its operation, and a normative evaluation, designed to outline the difficult value judgments that comprise the bankruptcy system. It also serves warning: before commentators propose any sweeping changes or policymakers take seriously any suggestions to scrap the system, they must consider the impact of such proposals on a number of competing normative goals.

Bankruptcy Courts And Stare Decisis: The Need For Restructuring, Jeffrey J. Brookner

University of Michigan Journal of Law Reform

Part I of this Note provides background by summarizing the rules of stare decisis. Part II refutes the contention that the present court structure allows bankruptcy judges not to follow domestic district court precedent. Part II asserts that, in pursuit of legitimate ends, bankruptcy judges have employed illegitimate means. Finally, Part II contends that bankruptcy judges are better equipped to make bankruptcy decisions than district judges. Part III concludes that the bankruptcy system should be restructured to allow bankruptcy judges to make decisions without being constrained by district court precedent or appeals. Such reform could achieve the substantive goals desired …

Of Hotel Revenues, Rents, And Formalism In The Bankruptcy Courts: Implications For Reforming Commercial Real Estate Finance, R. Wilson Freyermuth

Faculty Publications

This article is intended to continue the dialogue begun by the proposed Restatement and has two distinct goals in this effort. Parts I through III argue that the position of the Restatement drafters is both legally and functionally sound and that bankruptcy courts should embrace and apply the proposed Restatement in administering distressed real estate developments. Part I reviews the reasoning articulated in the hotel bankruptcy cases, demonstrating how courts have applied the provisions of the Bankruptcy Code and state law in a formalistic manner to extinguish the hotel mortgagee's lien upon postpetition room revenues. Part II rejects the analysis …

The Direct Action Against Insurers In Cercla Insolvency Cases: An Ideal Whose Time Has Come?, Peter R. Mounsey

William & Mary Environmental Law and Policy Review

No abstract provided.

Determining Interest And Discount Rates Applicable To Secured Claims In The Specter Of Bankruptcy Law, Aneel M. Pandey

San Diego Law Review

This Article formulates a basic framework to determine interest and discount rates applicable to secured claims in bankruptcy. It reviews the function of the interest rate from a macroeconomic perspective. The time value of money concept is explained, showing that the later a cash flow comes in time, the less it is worth. The treatment that debtors and creditors receive during the gap period (the time between the filing of the bankruptcy petition and the confirmation of the plan) is evaluated by examining how courts have struggled with the Bankruptcy Code to award post-petition interest. The author concludes by developing …

Bankruptcy, W. Homer Drake Jr., James W. Dilz

Mercer Law Review

During 1992, the United States Court of Appeals for the Eleventh Circuit decided fifteen cases in the area of bankruptcy law. The decisions covered a diverse array of sections of the Bankruptcy Code (the "Code"). In addition to cases with practical application within the Eleventh Circuit, several decisions have national significance. This Article is a survey of each bankruptcy decision by the Eleventh Circuit in 1992.

Grissom V. Johnson: Just The Facts..., Dean C. Copelan

Mercer Law Review

In Grissom v. Johnson (In re Grissom), the Eleventh Circuit Court of Appeals established a case-by-case analytical model to determine when a foreclosure sale brought a "reasonably equivalent value" under 11 U.S.C. § 548. Absent fraud, collusion, or illegal or unlawful procedures, courts should presume that the price brought at the legitimate foreclosure sale is a reasonably equivalent value of the property. For a bankruptcy trustee "to avoid [a] foreclosure sale as [a] transfer of property for which [the] debtor received less than reasonably equivalent value," the trustee "must establish specific factors which undermine confidence in the reasonableness …

Avoidability Of Foreclosure Sales Under Section 548(A)(2) Of The Bankruptcy Code: Revisiting The Transfer Issue And Standardizing Reasonable Equivalency, Vic Sung Lam

Washington Law Review

Federal courts consider the 1984 amendments to the Bankruptcy Code to have conclusively defined "transfer" to include foreclosure sales under section 548(a)(2). This Comment questions this widely accepted interpretation. Moreover, federal courts have strongly disagreed on the meaning of "reasonably equivalent value" under section 548(a)(2) of the Bankruptcy Code for the purpose of avoiding a foreclosure sale as a constructive fraudulent transfer. This Comment examines the three dominant but divergent approaches to determining reasonable equivalency. It concludes that both the Durrett 70-percent rule and the Madrid state-procedural approach are inappropriate standards because they fail to comport with the statutory language …

Baseline Problems In Assessing Chapter 11, Theodore Eisenberg

Cornell Law Faculty Publications

Dealing with failing businesses is like dealing with failing marriages. It is messy. The bigger the business the messier the process is likely to be. Many big business failures in the United States go through their death throes or cure their ills in reorganizations under Chapter 11 of the Bankruptcy Act. As the vehicle in which big business messes travel, Chapter 11 is viewed as unnecessarily complex, time-consuming, and costly. The justification for Chapter 11's very existence has been challenged.

This article suggests that we are blaming the vehicle for the mess that it carries. Much of what is problematic …

Bankruptcy—Qualified Erisa Plans Deemed Excludable From Bankruptcy Estates. Patterson V. Shumate, 112 S. Ct. 2242 (1992)., B. Shay Wilson

University of Arkansas at Little Rock Law Review

No abstract provided.

The Classification Veto In Single-Asset Cases Under Bankruptcy Code Section 1129(A)(10), David G. Carlson

Articles

No abstract provided.

The Fantastic Wisconsylvania Zero-Bureaucratic-Cost School Of Bankruptcy Theory: A Comment, James W. Bowers

Michigan Law Review

In two recently published articles, Wisconsin Law Professor Lynn LoPucki and Pennsylvania Law Professor Elizabeth Warren, nearly simultaneously, fired the latest shots in one of academia's hottest ongoing debates: whether any good reason for having bankruptcy law exists. Justice Holmes once opined that the future belonged to the lawyer skilled in statistics and economics. LoPucki and Warren apparently agree about statistics but argue that, in a world with positive transaction costs, economic theory has little to contribute to our understanding about the justifications for bankruptcy law.

I write to highlight what one might easily overlook in LoPucki's and Warren's pieces. …

Residential Mortgages Under Chapter 13 Of The Bankruptcy Code: The Increasing Case Against Cramdown After "Dewsnup V. Timm", David A. Wisniewski

Vanderbilt Law Review

Congress designed Chapter 13 to allow individuals an extended period of time to pay their debts so that they may support themselves and their dependents while repaying their creditors." Chapter 13 bankruptcy is more favorable to debtors than a straight liquidation under Chapter 7 because Chapter 13 debtors may keep all of their assets while Chapter 7 debtors must surrender most of their assets to generate funds with which to pay their creditors. A Chapter 13 debtor also benefits by avoiding the stigma and less favorable credit rating that accompanies a liquidating bankruptcy.s Chapter 13's benefit to creditors is also …

A Theory Of The Regulation Of Debtor-In-Possession Financing, George G. Triantis

Vanderbilt Law Review

The profile of Chapter 11 of the Bankruptcy Code in public consciousness has surged recently. Other than the automatic stay on the enforcement of claims, the most publicized feature of bankruptcy reorganizations is debtor-in-possession (DIP) financing. Indeed, along with the bankruptcy stay, DIP financing is the motivation for many Chapter 11 filings. Under Section 364 of the Code, a firm in bankruptcy (the debtor in possession) can finance its ongoing operations and investments by issuing new debt that enjoys any one of various levels of priority, all of which rank higher than the firm's prepetition unsecured debt.' The debtor's financing …

Protecting Retiree Medicial Benefits In Bankruptcy: The Scope Of Section 1114 Of The Bankruptcy Code, Susan J. Stabile

Cardozo Law Review

No abstract provided.

Bankruptcy Versus Environmental Protection: Discharging Future Cercla Liability In Chapter 11, Philippe J. Kahn

Cardozo Law Review

No abstract provided.

Secured Creditors And Section 15(A)(1) Of The Fair Labor Standards Act: The Supreme Court Creates A New Property Interest, Henry Bregstein

Cardozo Law Review

No abstract provided.