Another Bankruptcy Court Weighs in on Postpetition Interest

PBWT

2] In this case, unsecured creditors argued that they were “impaired” because the plan did not require the debtor to pay postpetition interest at the contractual rate or a higher state law judgment rate. [3]

Sixth Circuit Rules that Monthly 401(k) Contributions can be Excluded from “Projected Disposable Income” Under a Chapter 13 Plan

Foster Swift

A Chapter 13 bankruptcy plan requires a debtor to satisfy unsecured debts by paying all “projected disposable income” to unsecured creditors over a five-year period.

Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Section 1126 of the Bankruptcy Code and the Dangers of Sleeping on Your Rights as a Creditor

PBWT

This is especially true if you’re a creditor in a chapter 11 case. Two mortgage companies held more than $800,000 in secured claims, and 33 creditors had unsecured claims totaling about $1.1 Just seven unsecured creditors voted on the plan, all in favor.

What Are Debentures? Everything You Need To Know

Hudson Weir

In the case of insolvency or liquidation, a floating charge would give the lender priority over unsecured creditors in the order of repayment. Preferential creditors are next, including employees owed arrears of wages and holiday pay.

The Final Say: Conversion from Chapter 11 to Chapter 7 is Not a Given

PBWT

Unsecured Creditors Committee et al. , Bankruptcy Court for the District of New Mexico confirmed a plan that had been proposed by the unsecured creditors' committee.

Chapter 13 Bankruptcy and Student Loans

Sawin & Shea

This stay prohibits creditors, including your student loan lenders, from contacting you to collect any debts. Reduces payment amounts: Amounts paid to your student loans and other unsecured creditors will often be significantly lower through a Chapter 13 bankruptcy.

Your Commercial Debtor Just Went Bankrupt — Can You Still Get The Money You’re Owed?

Debt RR

Even in a best-case scenario — as a secured creditor — you could be waiting up to six years to receive payment. These will contain a listing of the amounts owed to each creditor, whether secured or unsecured. If the customer purchased something from you within 20 days of filing for bankruptcy, you might be able to elevate your claim to priority status over other unsecured creditors. For some creditors, that level of involvement might just be too much.

What Should I Know About Personal Bankruptcy and COVID-19?

Rocket Lawyer

Nonexempt property owned – A Chapter 13 bankruptcy requires that your unsecured creditors are paid at least as much as if you had filed Chapter 7. Unsecured creditors would have, under Chapter 7, been entitled to your nonexempt property value.

Critical Vendors Aren’t Immune from Lawsuits to Recover Preferential Transfers

PBWT

Accordingly, critical vendors often recover more on their pre-petition claims than other unsecured creditors. In other words, critical vendors could receive a full recovery, while other creditors only receive a fraction of what they are owed.

The Return of the Crown Preference – A blog by Menzies

CICM

The Enterprise Act 2002 came along, and we saw this abolished and replaced with the Prescribed Part – a pot of money ring fenced for the unsecured creditors. This was a redistribution of the wealth as it meant HMRC’s debt became ‘unsecured’ like everyone else, but they still got a return from floating charge assets. At the same time, it was seen as fairer because all the other unsecured creditors also received a slice. A long, long time ago….

What You Should Know About Personal Bankruptcy Laws and COVID-19

Rocket Lawyer

Nonexempt property owned – A Chapter 13 bankruptcy required that your unsecured creditors are paid at least as much as they would have been paid if you had filed Chapter 7. Unsecured creditors would have, under Chapter 7, been entitled to your nonexempt property value.

HMRC facing £65bn Debt Collection challenge

UK debt collections

The position is further complicated as from 1 December 2020 HMRC is now treated as a preferential creditor in any insolvency , meaning it is entitled to be paid ahead of unsecured creditors and floating charge lenders.

As Chapter 11 Bankruptcy Filings Surge, Here’s What Creditors Need to Know to Protect and Enforce Their Rights

Fraser

Creditors of a bankrupt company must be aware of the various deadlines and procedures that govern the chapter 11 process in order to protect and enforce their rights. For creditors to maximize their recoveries, they must stay informed and take action during a bankruptcy proceeding.

Floating Charges And Fixed Charges: Understanding The Differences

Hudson Weir

Insolvency proceedings follow a set pattern, determining the order in which creditors are reimbursed. Creditors holding fixed and floating charges are defined as “secured lenders”. Due to the nature of your business, or its current status, an unsecured option may be more appropriate.

Losing Momentum:  Houston Bankruptcy Court Holds that Make-Whole Claims are Not the Economic Equivalent of Unmatured Interest Subject to Disallowance; Solvent-Debtor Exception Lives

PBWT

2] The Fifth Circuit also instructed Judge Isgur to determine whether the creditors were entitled to post-petition interest at the contractual default rates under the “solvent-debtor” exception. [3]

Court Dismisses Bankruptcy Case to Enable Debtor to Seek a Paycheck Protection Loan

PBWT

The debtor’s motion to dismiss drew creditor opposition. With respect to the DIP loan, the debtor noted that as an unsecured creditor, RT was in the same position as if the debtor had a secured loan outside of bankruptcy.

All in a Day’s Work. Belk Achieves Confirmation of Pre-Packaged Plan in Record Time

PBWT

” [1] Critically, the plan leaves all unsecured creditors unimpaired. We posit a few of those here: Broad Creditor Support. Leaving trade creditors unimpaired, while not legally required, is an essential pragmatic consideration.

Pre Pack Administration: What It Involves And How To Do It

Hudson Weir

In some cases, a company voluntary arrangement (CVA) or creditors’ voluntary liquidation (CVL) may be a better option. For a pre pack administration to take place, the procedure must be in the best interests of the company and its creditors. This preserves funds for the creditors.

A Primer On Administrative Expense Claims From An Oil And Gas Bankruptcy Case

PBWT

Some of Whistlers’ creditors also filed an involuntary chapter 11 petition against Whistler. The claim drew objections from Whistler, one of its secured creditors, and the unsecured creditors’ committee.

Car Payments and Car Repossession

Sawin & Shea

During your Chapter 13 bankruptcy, unsecured creditors are forced to take payments in only the amount the law says you can afford or have to pay. Are you behind on car payments? Is a car repossession looming in your future? Now’s the time to act.

What Is An Insolvent Estate? All You Need To Know

Hudson Weir

In addition to the personal representative, an insolvency administration order can be sought by a creditor, a liquidator, a temporary administrator or the supervisor of an individual voluntary arrangement that the deceased person was subject to.

Fox News:  New Mexico Bankruptcy Court Reaffirms Committee Eligibility for Derivative Standing Despite Contrary Tenth Circuit B.A.P. Precedent

PBWT

In an important affirmation of the rights and duties of a creditors’ committee, Bankruptcy Judge David T. a creditor that recovers, after the court’s approval, for the benefit of the estate any property transferred or concealed by the debtor.”

Second Circuit Clarifies Standard for Judicial Admissions

ABI

of Unsecured Creditors of Color Tile, Inc. By: Lianna Murphy. John’s University School of Law. American Bankruptcy Institute Law Review Staff Member. . A judicial admission “is a statement made by a party or its counsel” regarding a fact that is binding on the admitting party throughout the case. [1] 1] In Pillars v.

Dealing With Debt From COVID-19

Debt Free Colorado

Below you’ll find some strategies for working with your creditors and deciding which bills are the most important if you can’t pay them all. Reach out to your creditors. How do I pay my Bills if I’m out of Work due to a Stay-At-Home Order?

Rough Justice: Third Circuit Issues Important Decision on Unfair Discrimination

PBWT

In the alternative, they argued that the relative recoveries of senior and subordinated creditors resulted in “unfair discrimination” prohibited by the Code. [2] “Unfair discrimination is rough justice.

Luxurious Lifestyles Can Undermine the Good Faith Requirement for ?Proposed Chapter 11 Plans of Reorganization

ABI

4] Debtor’s initial proposed plan was rejected by the judgment creditors because it paid them less than twenty percent on the outstanding debts. The second plan proposed paying those creditors in full over two decades. Although the creditors voted to accept the second proposed plan, the bankruptcy court refused to confirm the plan because it concluded that the plan was not feasible and it unfairly discriminated against other creditors. By: Spencer Nelson.

How Businesses Use Corporate Debt Restructuring for Liquidity

admin

Debts can quickly cripple a business, and negotiating more favorable terms with creditors is usually the best way out. Many businesses are both debtors and creditors. Creditors can cut their losses, and everyone can come to an agreement on how to move forward with a deal that benefits everyone involved. Debt restructuring is a mechanism where a business’s creditors restore liquidity by reorganizing financial obligations. Secured Creditors. Unsecured Creditors.

Debtor May Establish Reasonably Equivalent Value Through Estimates of Intangible Benefits

ABI

of Unsecured Creditors ( In re R.M.L., By: Alexandria Stiteler. John’s University School of Law. American Bankruptcy Institute Law Review Staff Member. . Under title 11 of the United States Code (the “Bankruptcy Code”), a trustee appointed to a debtor’s estate may avoid transfers made within two years before the date of the filing if the debtor received less than reasonably equivalent value in exchange. [i] i] In In re Miami Neurological Inst.,

SURVIVING FINANCIAL DISTRESS FROM COVID-19 IN THE RESTAURANT, BAR, AND SERVICE INDUSTRY

BN Lawyers

Work with Creditors. Most creditors (lenders, suppliers, employees) will be aware of the distress facing the entire service industry. If there is a mitigating factor at play, it is that creditors know that even well-run companies that will be profitable over the medium- and long-term will face short-term liquidity problems and distress. Many creditors will be willing to work with businesses. Creditors face their own pressures. Access Existing Unsecured Credit.