Bankruptcy (1985—1989)Repossessing the Spirit of St. Louis: Expanding the Protection of Sections 1110 and 1168 of the Bankruptcy Code
Louis B. Goldman, Michael J. Album, and Mark S. Ward, 41(1): 29–55 (Nov. 1985)
This Article examines sections 1110 and 1168 of the Bankruptcy Code, which create preferred repossession rights for certain lenders to the transportation industry. The class of lenders benefitted by the statutes is unclear; on their face the statutes appear to apply to a large class of lenders, but the legislative history suggests that Congress intended to benefit only those lenders who finance the acquisition of equipment. The authors conclude that the legislative intent probably would prevail and discuss certain refinancing arrangements that would qualify for protection under the statutes.
The Bankruptcy Preference Laws: Interpreting Code Sections 547(c)(2), 550(a)(1), and 546(a)(1)
Isaac Nutovic, 41(1): 175–208 (Nov. 1985)
The rules for recovering preferences under the bankruptcy laws were drastically changed with the passage of the Bankruptcy Reform Act of 1978, and the courts are still struggling to interpret these changes. This Article analyzes recent decisions relating to three discrete issues arising in preference litigation— the ordinary course of business defense, the recovery of indirect preferences to insiders from the preference transferees, and the time limitations on the bringing of preference actions by Chapter 11 debtors—and suggests alternate interpretations of the relevant statutory provisions.
Priorities Disputes in Motor Vehicles and in Other Certificated Goods
Richard L. Epling, 41(2): 361–76 (Feb. 1986)
This Article examines the priorities conflicts that often arise when a dealer in automobiles, mobile homes, trucks, or other certificated goods becomes insolvent and unable to pay its debts. Priorities conflicts between and among the dealer's suppliers, secured floorplan lender, customers and purchasers, and bankruptcy trustee are examined. The effect of physical possession of the title certificate or manufacturer's statement of origin by various claimants is given particular scrutiny.
The Right of Creditors to Prosecute Bankruptcy Petitioners for Fraudulent Debt
Robert Craig Waters, 42(1): 249–58 (Nov. 1986)
This Article examines judicial responses to criminal actions brought against debtors who have filed for protection under the 1978 Bankruptcy Reform Act. Conflict exists between the culmination of an isolated criminal proceeding (often resulting in restitution by the debtor to a victim/creditor) and the policies of the Bankruptcy Code. The Article discusses the conflict and the extent to which it justifies an order of the bankruptcy court enjoining the criminal prosecution.
The International Void in the Law of Multinational Bankruptcies
Richard A. Gitlin and Evan D. Flaschen, 42(2): 307–25 (Feb. 1987)
This Article explores the dearth of laws governing multinational bankruptcies and offers some suggestions for reform. It briefly discusses existing multilateral treaties and the 1980 draft convention of the EEC member states on bankruptcy and similar proceedings. It also analyzes U.S. recognition of foreign bankruptcy proceedings by examining cases decided under section 304 of the Bankruptcy Code.
In re Frenville: A Critique by the National Bankruptcy Conference's committee on Claims and Distributions
Ralph R. Mabey and Annette W. Jarvis, 42(3): 697–714 (May 1987)
This Article is a critique of In re M. Frenville Co., 744 F.2d 332 (3d Cir. 1984), cert. denied, 469 U.S. 1160 (1985), which holds that a third-party indemnification claim against a debtor in bankruptcy arising out of a lawsuit filed post-petition is not subject to the automatic stay.
Environmental Liens in Bankruptcy
Richard L. Epling, 44(1): 85–102 (Nov. 1988)
The courts have been increasingly required to confront the interplay between state and federal environmental statutes, many of which create inchoate or secret liens, and the rights of trustees, debtors, and creditors under the Bankruptcy Code. This Article argues that the exception to the avoiding powers contained in 11 U.S.C. § 546(b) should be amended to permit the trustee in bankruptcy to avoid such liens. The Article also discusses the priority claims that are not secured by a statutory lien.
The Chapter 11 Disclosure Statement in a Strategic EnvironmentSubHeading
Glenn W. Merrick, 44(1): 103–21 (Nov. 1988)
Too often the Chapter 11 disclosure statement receives only cursory consideration in the strategy of both protagonists and antagonists of a reorganization plan. This Article reviews the genesis of the Chapter 11 disclosure statement, surveys current law regarding its contents, and discusses techniques for using it more effectively.
Intellectual Property Licenses in Bankruptcy: New "Veto Power" for Licensees Under Section 365(n)
Stuart S. Moskowitz, 44(3): 771–90 (May 1989)
Although technology licenses have been found to constitute executory contracts under the bankruptcy law, parties to such contracts attempting to understand their rights have often been left floundering as courts have applied varying standards and reached different conclusions when licensees sought to reject such contracts in recent bankruptcy cases. In an attempt to reduce uncertainty, Congress amended the Bankruptcy Code in October 1988 to allow for special treatment of intellectual property licenses. Although the legislation goes far to establish rules on a number of key issues, it also raises questions which may require congressional attention in the near future.
The Examiner in the Reorganization Process: A Need to Modify
Lawrence K. Snider, 45(1): 35–56 (Nov. 1989)
Since the enactment of the Bankruptcy Code, there have been relatively few reported cases dealing with the examiner and the examiner's power and duties in the reorganization process. Several decisions suggest that the Bankruptcy Code's provisions dealing with the examiner should be modified. Courts also need to exercise more discretion in an examiner's appointment. The Code's so-called mandatory appointment of an examiner should be eliminated, and the "investigatory tools" of the examiner need to be enhanced to enable the examiner to play a meaningful role in the reorganization process.
Chapter 11—The Bank of Last Resort
Gary E. Klausner, Richard M. Pachulski, and Brad R. Godshall, 45(1): 261–88 (Nov. 1989)
This Article addresses certain significant issues in the continuing battles fought by debtors and lenders over debtors' attempts to utilize bankruptcy courts as the bank of last resort. The Article focuses on provisions of the Bankruptcy Code which make it possible for debtors to resurrect defaulted loans in the guise of nonimpairment plans or actually to obtain the effect of refinancing from existing lenders under "cram-down" provisions of the Bankruptcy Code.
Entitlement of Secured Creditors to Default Interest Rates Under Bankruptcy Code Sections 506(b) and 1124
Melanie Rovner Cohen, Jeff J. Marwil, and Richard A. Gerard, 45(1): 415–27 (Nov. 1989)
The enforceability of default interest rate provisions in contracts has been questioned when the debtor is in proceedings under the Bankruptcy Code. This Article considers the allowability of default interest rates in the context of a bankruptcy proceeding in light of the recent Supreme Court case, United States v. Ron Pair Enterprises, Inc., 489 U.S. 235 (1989). It also discusses the interpretation and application of Bankruptcy Code sections 506(b) and 1124.