Claims In Bankruptcy Research Articles

A classificação do crédito de natureza alimentar na falência do empresário individual

The Decree-Law No. 7,661 of 1945 explicitly prohibited the inclusion of alimony claims in the creditor's ranking in bankruptcy cases, based on the reasoning that such obligations were personal and should not burden the creditors. With the enactment of Law No. 11,101/2005 (LRF), the legislation remained silent on alimony claims, allowing for their inclusion in bankruptcy proceedings involving individual entrepreneurs, as per Article 126. Consequently, the research examined the classification of alimony claims in bankruptcy, suggesting that, due to their legal nature and the vulnerability of claimants, they should be treated similarly to labor claims of a strictly wage-related nature. The methodology used was the hypothetical-deductive scientific method, with a bibliographic and jurisprudential analysis. The hypothesis was confirmed.

Special Aspects of Bankruptcy Claims Trading

Special Aspects of Bankruptcy Claims Trading

The Liquidation Order for Bankruptcy Claims of Chinese Real Estate Development Enterprises

The Liquidation Order for Bankruptcy Claims of Chinese Real Estate Development Enterprises

특수한 파산채권 - 채권양도통지청구권과 등기 부인을 원인으로 한 소유권이전등기청구권에 관하여 -

특수한 파산채권 - 채권양도통지청구권과 등기 부인을 원인으로 한 소유권이전등기청구권에 관하여 -

견련파산 당시 계속 중인 회생채권조사확정재판에 대한 이의소송의 처리

At the time the converted bankruptcy is declared pursuant to Article 6(1) of the Debtor Rehabilitation and Bankruptcy Act (hereinafter “Debtor Rehabilitation Act”) resulting from the discontinuation of rehabilitation procedure after the authorization of a rehabilitation plan, a lawsuit objecting to the judgment in claim allowance proceedings filed in rehabilitation procedures may be pending. The Supreme Court, in the judgment of 2016Da254467, 254474 decided on December 10, 2020 (hereinafter “subject case”), stated that the creditor shall take over the lawsuit objecting to the judgment in claim allowance proceedings on rehabilitation claims pursuant to Article 464 of the Debtor Rehabilitation Act and the other party may also file a request for takeover. The subject case also stated that the plaintiff of the lawsuit should either alter the previous purport of the claim from seeking the confirmation of the table of rehabilitation creditors to seeking the confirmation of the table of bankruptcy creditors or seek the confirmation of both the table of bankruptcy creditors and rehabilitation creditors. Since the lawsuit objecting to the judgment in claim allowance proceedings on rehabilitation claims corresponds to a lawsuit involving disputed claims as referred to in Article 464 of the Debtor Rehabilitation Act, the creditor shall take over the lawsuit in accordance with Article 464 of the Debtor Rehabilitation Act and the other party may also file a request for takeover. After taking over the lawsuit, the purport of the claim shall be altered to seeking confirmation of bankruptcy claims in order to confirm bankruptcy claims. In addition, it is necessary to maintain the seeking for confirmation of rehabilitation claims in order to reflect the circumstances in which the rehabilitation claims confirmed according to the claim allowance procedure stipulated in the rehabilitation procedures are substantially altered by the rehabilitation plan. Therefore, the alteration in claims for confirmation of bankruptcy claims should be made as an additional alteration, not an exchangeable alteration. It is questionable that the subject case recognized an exchangeable alteration from confirmation of rehabilitation claims to confirmation of bankruptcy claims, and that the subject of the confirmation was the “table of bankruptcy/rehabilitation creditors”, not the “bankruptcy/rehabilitation claims”.

Subordination of Shareholder Claims in Bankruptcy of Corporations

Subordination of Shareholder Claims in Bankruptcy of Corporations

An economic analysis of nontraditional lending in Chapter 12 bankruptcy cases

PurposeNontraditional lenders are important credit providers for farmers. However, previous research has found that farmers who use nontraditional lenders are riskier lending opportunities. Using a unique dataset of Chapter 12 bankruptcy cases, the authors analyze the share of payment that is made or allowed by the courts on debt owed to traditional and nontraditional lenders.Design/methodology/approachThe authors use a Tobit model to calculate parameter estimates and marginal effects of the impact of creditor type (traditional/nontraditional) and debt classification (secured, priority and unsecured) on the proportion of a bankruptcy claim that lenders receive or are expected to receive when a case is discharged.FindingsThe authors find that traditional lenders with secured debt receive a greater repayment than nontraditional lenders. Meanwhile, there are more than twice the number of nontraditional lenders that are owed debt in these bankruptcy claims. While this raises concern for nontraditional lenders, that is mitigated some by the level of debt that is on average about one-sixth the size of the average debt of traditional lenders. Finally, the authors show there are numerous opportunities for future research in this area using case level bankruptcy data.Originality/valueThis paper fills a research gap by focusing on the state of nontraditional lenders in Chapter 12 bankruptcy cases and their treatment in discharged cases.

최근 일본의 개정회사법상 사채관리보조자에 관한 검토

The bond administrator system in Japan was introduced with the amendment to the Companies Act in 1993. However, in practice, few people wanted to become a bond administrator because of the onerous duties and responsibilities of bond administrators. In addition, there were high costs for a bond administrator. Therefore, when the Companies Act was amended in 2019, the bond administrative assistant system was established. The bond administrator has comprehensive authority for administering bonds with a wide range of discretion. On the other hand, the bond administrative assistant system requires that a bond administrative assistant, a third party, assists in bond administration for bond holders on the premise that bond holders will administer bonds by themselves.<BR> Therefore, the scope of authority and discretion of a bond administrative assistant is more limited than that of a bond administrator. As such, bond administrative assistants do not have a wide range of discretion for administering bonds on their own. Rather a bond administrative assistant provides assistance in the administration of bonds by bond holders, such as ① reporting bankruptcy claims of bond holders and ② in the case of a claim by a bond holder, providing help in administering the bonds, such as through organizing a meeting of bond holders. This article reviews the overall bond administrative assistant system and considers the effectiveness of Korean legislation.

Kompenzacija u stečajnom pravu Republike Srbije i regionu

This article discusses a concept of legally permitted and limited offsetting in bankruptcy according to the law of the Republic of Serbia, with comparison to earlier regulations where the offsetting occurred by the force of law, as the legal consequence of initiating bankruptcy proceedings. Legal provisions, legal practice, opinion of the jurisprudence on general and special terms about the right to offset the claims in bankruptcy in the Republic of Serbia, as well as in the countries in the region, have been presented. Relevant legal solutions from laws on bankruptcy of Montenegro, Republic of Srpska, Republic of Croatia, and the Republic of Slovenia have been reviewed. Offsetting claims in bankruptcy proceedings are in principle allowed in regional countries as well. Regarding the effect of bankruptcy on the right to offset the claims, there is a great similarity among the legal solutions in regulations of above mentioned countries, except for the Republic of Slovenia. The Republic of Slovenia retained the broadest concept of legal compensation as a legal consequence of initiating bankruptcy proceedings, which constitutes an important difference compared to restrictive solutions of the Serbian bankruptcy law and regional legislation. This article aims to show to the business entities operating in the region, through comparative legal analysis, different conditions and procedure of offsetting in bankruptcy in national legislation, bearing in mind the importance of this legal institution, which allows the creditors to fully collect their claims outside the bankruptcy payment lines, and regardless of the number of available funds in the bankruptcy estate.

Inequitable Subordination: Distressing Distressed Purchasers by Propagating Subordination Benefit Elimination Theory

This Article examines the application of equitable subordination under Title 11 of the United States Code to bankruptcy claims purchasing transactions that transpire after the occurrence of inequitable conduct by a third party. Although a significant issue with practical consequences, it has drawn relatively scant commentary. To the author’s knowledge, no scholarship to date has attempted to comprehensively discuss the issue or describe the indirect cleansing and washing of tainted claims resulting therefrom. While analyzing and criticizing the current state of the law, this Article introduces the concepts of the “subordination benefit,” “subordination benefit elimination theory,” and “limited subordination benefit theory” to facilitate and further conversations related to the intersection of equitable subordination and bankruptcy claims trading. This Article primarily aims to promote an active, fluid bankruptcy claims trading market to, on an ex post basis, benefit creditors and, on an ex ante basis, reduce the cost, and induce the extension, of credit in the primary capital markets, thereby supporting the broader economy. Additionally, this Article seeks to reduce indirect cleansing of tainted claims and indirect claims washing through the bankruptcy claims market. The subject matter is particularly timely and relevant, given the recent publication of the Final Report and Recommendations of the American Bankruptcy Institute Commission to Study the Reform of Chapter 11, the significant growth of the claims trading market and the increasing activity and sophistication of distressed investors, and the recent formation of the American Bankruptcy Institute’s Claims Trading Committee. This Article argues that subordination benefit elimination theory, which represents the dominant theory propagated by courts and commentators, finds support in a misguided reading of caselaw and conflicts with sound economic policy and logic. Further, while acknowledging limited subordination benefit theory is a superior approach to subordination benefit elimination theory, this Article argues that limited subordination benefit theory also runs contrary to sound economic policy and logic. This Article requests commentators and courts halt and reverse the propagation of subordination benefit elimination theory and avoid disseminating limited subordination benefit theory. Instead, this Article proposes post-misconduct discounted claims purchasers be entitled to participate in the subordination benefit to the same extent as pre-misconduct claimholders. If commentators and courts are unready to abandon both theories and if required to make a suboptimal binary choice, this Article suggests limited subordination benefit theory be propagated and utilized in lieu of subordination benefit elimination theory.

Bankruptcy Claims of Illinois Tax Purchasers After Expiration of the Redemption Period and Before Recording of the Tax Deed

In Illinois, if real property owners fail to timely pay their property taxes, the county conducts a sale of the delinquent taxes to third parties. In such property tax sales, the county receives the amount of the taxes due and shifts the payment risk to a third-party “tax purchaser.” In exchange, the tax purchaser receives a “Certificate of Purchase” that entitles the holder to repayment of the amount of delinquent taxes paid to the county plus interest, and costs, fees and penalties set by statute. Additionally, a contingent right is conveyed to the tax purchaser who purchased the delinquent taxes: should the property owner fail to redeem the delinquency by the statutorily-determined deadline, the tax purchaser may petition an Illinois court to order the county to issue a tax deed. For more than 15 years, bankruptcy courts applying Illinois law treated the redemption deadline as demarcating the debtor’s right to treat the redemption amount as a claim in a bankruptcy plan. But two Seventh Circuit holdings over the past decade abrogated the previous approach that recognized a distinction before and after the redemption deadline. The consequent appeals court jurisprudence has shifted the focus to the recording date of the tax deed. As recently as April 2019, the Bankruptcy Court in the Northern District of Illinois declined a tax purchaser’s request to reconsider and reverse the revised approach. Consequently, Illinois tax purchasers should expect courts to allow chapter 13 debtors to treat delinquent taxes underlying a Certificate of Purchase as a claim in a bankruptcy plan — even after the statutory period to redeem the delinquent taxes has expired.

Berkeley Law Visiting Scholars Program Workshop Presentation- Inequitable Subordination (Presentation Slides)

PowerPoint Presentation accompanying Berkeley Law Visiting Scholars Program Workshop on September 20, 2019. The presentation was entitled Inequitable Subordination: Distressing Distressed Claims Purchasers by Propagating Subordination Benefit Elimination Theory, and focused on the intersection of equitable subordination and the modern bankruptcy claims market.

Ehdolliset saatavat ja konkurssinvarainen sopiminen

According to the Finnish Bankruptcy Act (120/2004, as amended) Chapter 1, Section 5, conditional claims are generally considered as acceptable claims in bankruptcy. However, these claims may sometimes contradict with primary bankruptcy law principles, if they seem to be only applicable in bankruptcy. In these situations, conditional claims can be considered to be caused by so called ipso facto clauses, meaning contracts (or single terms) that have the sole purpose of affecting the rights of debtors in case of a bankruptcy. Courts and legal scholars have consistently found such agreements unenforceable but the detailed functioning of the doctrine has long been quite unclear. In response, this article aims to clarify the assessment, giving main emphasis to the critical analysis of a fairly recent case, KKO 2016:100, resolved by the Supreme Court of Finland in December 2016. According to the case analysis, the scope of the clause is found to be the decisive factor, concluding a rather problematic rule that conditional claims may only be regarded as ipso facto clauses, if they apply in virtually no other situations than bankruptcy.

Comparative Study of Valuing Secured Claims In Bankruptcy by U.S. And Swiss Law

This project extends the literature which explores different approaches to bankruptcy and valuing secured claims in U.S. Bankruptcy Code and Swiss Debt Enforcement and Bankruptcy Law. We begin with provision of comparative analysis of corporate bankruptcy proceedings according to Chapter 11 or Chapter 7 in the case the company is sold or in the case the company is reorganized under Chapter 11 in comparison to bankruptcy proceedings according to Swiss Debt Enforcement and Bankruptcy Law or in the case the company is reorganized according to article 725 Swiss Code of Obligations. We study the problem of valuing secured claims. This part of the project builds on the literature exploring different approaches of valuing secured claims in bankruptcy such as the bargaining approach, the approaches based on the mechanism of auctions and options, and the approach investigating market-based mechanism recently proposed by Lucian Arye Bebchuk & Jesse M. Fried (2001).

Tax claims, government priority, absolute priority and the resolution of financial distress

We present a model of an insolvent firm that may take advantage of a ‘soft-touch’ government creditor in order to buy time before filing for reorganization, behaviour we refer to as ‘claims substitution.’ Parameters in the model reflect the enforcement of absolute priority and government priority in bankruptcy. We show that deviations from absolute priority reduce the incentive for claims substitution. We also show that strict government priority is economically efficient. We discuss the implications of our findings for bankruptcy law reform, especially with respect to the priority of tax claims in bankruptcy and the enforcement of absolute priority.

Bankruptcy Resolution and the Restoration of Priority of Claims

We present new evidence on the violation of priority of claims in bankruptcy and recovery rates for secured creditors, unsecured creditors, equity holders using a sample of firms that filed for Chapter 11 bankruptcy between 1993 and 2004. Our study reveals a number of new insights: First, we find a significant reduction in the violations of priority of claims compared to research on prior periods with equity holders appearing to have lost their ability to extract concessions in violation to priority of claims. Second, the results are consistent with the hypothesis that unsecured creditors accept a violation to priority of their claims in order to obtain a faster resolution. Third, the results suggest that secured creditors are less likely, and unsecured creditors are more likely, to experience a violation to priority of their claims when secured creditors exercise increased control over the debtor (as proxied by debtor in possession financing). Finally, violations to secured creditors priority of claims are more likely when filings occur in Delaware and the Southern District of New York than elsewhere.

Possible ramifications of introducing the institute of personal bankruptcy: The USA experience

In the past decade, the increase of household debt in Serbia as well as in the entire region has brought the issue of personal bankruptcy into the spotlight. The adoption of this procedure would enable individuals who are over-indebted and unable to settle out the credit and current payables to file for personal bankruptcy. The main objective of this procedure would be to ensure the maximum reimbursement of creditors' claims from the debtor's available assets and annual revenues. Such a procedure would also provide for the protection of the debtor's basic human rights and dignity. In order to provide a fresh start for the debtor and his financial standing, bankruptcy proceedings commonly include debt write-offs, to some extent. Obviously, personal bankruptcy has two sets of goals, which are mutually inconsistent, contradictory and often incompatible. In order to prevent possible abuses, bankruptcy reasons must be clearly defined and set out in more rigorous terms. This paper analyzes the impact of personal bankruptcy in generating the global economic crisis and the repercussion that personal bankruptcy has had on the global economy. The increase in the number of bankruptcy proceedings filed in the USA in 2005 was a warning about the forthcoming events. Mortgage loans were the major reason for filing a large number of personal bankruptcy claims. In fact, until 2006 the US real estate market had been booming but no one could have guessed then that the real estate values would fall sharply in the years to come. Credit deregulation caused higher demand for mortgage backed loans and the nation's household debt increased significantly. However, the negative selection of debtors, their insolvency and irregular payment of annuities caused turmoil, which generated major problems for financial institutions. At the end of2007, nearly 16 percent of all mortgage loans were uncollectible in full. The analysis of events that led to the onset of the global economic crisis and the role of personal bankruptcy as its most probable cause yields a conclusion that the adequate legal regulation of this process is paramount. The experiences of countries that have already introduced this legal institute are invaluable. The countries in the region which have set too rigorous rules for debt write-offs are currently facing the option of undertaking massive write-offs of debtors' claims, which are most unlikely to be objective. On the other hand, in the countries which have envisaged too flexible proceedings for debt write-offs, there is a negative selection of debtors and default of financial institutions. With this experience in mind, it is necessary to regulate and apply the institute of personal bankruptcy so that it provides for the maximum debt collection as well as for accomplishing the major social goals.

TOURISM ENTREPRENEURIAL OBJECTIVES, COVID-19 AND SUSTAINABLE TOURISM MARKETING STRATEGY

The achievement of entrepreneurial objectives by tourism entrepreneurs is dependent on the existence of a dynamic, attractive, safe and competitive tourism destination capable of creating and delivering memorable experiential value which enhances tourist satisfaction and subsequent behaviouralintentions. However, the menace occasioned by the COVID-19 pandemic has posed a critical challenge and a bitter contradiction with the expectations and plans of tourism entrepreneurs all over the world. This explains why several attraction sites and other tourism and hospitality service organisations are either shut or operating at dismal operational levels with the consequent loss of jobs, leisure time as well as filing for bankruptcy claims, etc. The situation calls for a paradigm shift in destination marketing strategy. This present study seeks to situate the quest to achieve tourism entrepreneurial objectives during this austere and uncertain period (POST COVID-19) on the ability of tourism service providers to craft, implant and implement sustainable tourism marketing strategies. The study proposes academic, stakeholder and marketing implications.

The Paradoxes of Secured Lending: Is There a Less Uneasy Case for the Priority of Secured Claims in Bankruptcy?

This paper is inspired directly by two articles coauthored by Professors Bebchuk and Fried, which comprehensively questioned the efficiency of the bankruptcy priority awarded to secured claims. It starts by pointing out the following efficiency benefit of such priority largely unmentioned in the legal literature, including the Bebchuk and Fried articles: the priority of secured debts undermines borrowers’ incentives to pursue excessively risky investment projects under certain circumstances. However, this additional benefit also exposes two interrelated paradoxes pertaining to the welfare effects of secured claims with bankruptcy priority. For one thing, while issuance of secured senior debts helps constrain over-risky investment incentives in some contexts, it nevertheless promotes this kind of incentives in others. For another, the advantage of disincentivizing excessive risk-taking behaviors rests exactly on the distribution effects of the priority enjoyed by secured lenders. By identifying and elaborating these paradoxes of secured lending, this paper contributes to the literature in two aspects. First, it underlines the overshadowed function of secured lending in attenuating over-investment incentives, which so far has been left out of the calculus when the efficiency of secured debts is assessed by most legal scholars. In particular, this study reminds us of the potential price of aggravated risk-taking behaviors if tort claims are entrenched with a super priority status in bankruptcy, an issue barely brought up in the literature. Second, this paper also cautions the proponents of the secured credit priority system on the fragility of its presumed efficiency which hinges substantially upon its distributional outcomes. The paradoxes discussed in this paper will challenge the efforts to buttress the priority of secured claims by qualifying the scope of potential victims of its distributional effects. My discussion will show that the smaller the scope of victims, the lower the significance of secured lending in boosting efficiency. Essentially, this paper extends the logic underlying “the puzzle of secured debt” to the efficiency analysis of secured lending from a broader perspective. Although it is not aimed specifically at offering new solutions to the puzzle, this paper seeks to clarify misunderstandings in previous works following primarily the framework laid down by Professor Schwartz.

A classificação dos créditos falimentares e a função social da empresa na falência

This article intends to open or bring to light a debate about the bankruptcy claims under the aegis of Law 11.101/2005, considering that all credit rating urged a modern update, centered in Social Law, which only occurred with the New Bankruptcy Law. The study was exploratory and qualitative, with the strategy to approach each claim, denominating the differences of recent legislation with former Decree 7.661/1945, demonstrating why the payment order structured by the law under discussion, including the approach of controversial issues such as limiting the receipt of one hundred and fifty minimum salaries of workers' claims, and finally, proof that the classification of credits arising from Law 11.101/2005 fulfill the social function of the company, even in bankruptcy, since it values and reflects the respect to creditors according to the nature of their claims.