On Bankruptcy and Mediation
A poison-pill? (Photo by Marily Swanson) By: Donald L Swanson The common law of assignments for benefit of creditors (“ABC”) has been around for centuries. ABC is a business debtor’s voluntary liquidation tool—typically utilized in cooperation with a major secured creditor. Historically, ABCs are attractive to debtors and creditors alike as an efficient, mostly out-of-court tool... Continue Reading →
By: Donald L Swanson I’m serving on a Drafting Committee of the Uniform Law Commission for a uniform law on assignment for benefit of creditors (“ABC”). A draft of such a uniform law is coming together, with lots of input from many people and organizations. But we are always looking for more input. So, if you'd like to participate... Continue Reading →
By: Donald L SwansonI’m serving on a Drafting Committee of the Uniform Law Commission for a uniform law on assignment for benefit of creditors (“ABC”). A draft of such a uniform law is coming together, with lots of input from many people and organizations. And we are always looking for more input! At one point, I’m... Continue Reading →
Subject matter jurisdiction? (Photo by Marilyn Swanson) By: Donald L Swanson Delaware’s Court of Chancery has no subject matter jurisdiction over an assignment for benefit of creditors proceeding when the debtor/assignor is an Illinois corporation with no assets or operations in Delaware, even when its ABC assignee/trustee is from Delaware. That’s the decision of Delaware’s Court... Continue Reading →
Uniformity (photo by Marilyn Swanson) By: Donald L Swanson 2023 is the year that the need for a uniform state law on assignments for benefit of creditors became obvious. And a Drafting Committee at the Uniform Law Commission began working in 2023 to create such a law. Here are some of the reasons why the need... Continue Reading →
California dreamin’ (photo by Marilyn Swanson) By: Donald L Swanson The following combination of facts seems odd . . . and confusing. The Uniform Voidable Transactions Act ("UVTA") authorizes (in Sec. 5(b)) unsecured creditors to avoid insider preferences, with a one-year reach back, when the insider "had reasonable cause to believe that the debtor was insolvent"... Continue Reading →
An Illinois view (photo by Marilyn Swanson) By: Donald L Swanson Assignments for benefit of creditors (“ABC”) are rarely used in these United States. That’s for two reasons: (i) some states have no ABC statute and do not recognize the common law of ABCs, and (ii) other states have onerous ABC statutes that no one wants... Continue Reading →
Supervision (Photo by Marilyn Swanson) By: Donald L Swanson For some reason, there is a fascination out there (not sure where, exactly) with having every assignment for benefit of creditors (“ABC”) supervised by a court from the get-go. This fascination suggests that every ABC effort requires court action and judicial approvals, from the beginning and throughout... Continue Reading →
Working together? (Photo by Marilyn Swanson) By: Donald L Swanson Illinois follows the common law of assignments for benefit of creditors (“ABC”): a non-judicial, trust-like process for liquidating a failed business. That ABC process can work, hand-in-hand, with the Bankruptcy Code. The case of In re Computer World Solutions, Inc., Case No. 07-21123, Northern Illinois Bankruptcy... Continue Reading →
Really-cool but rarely used (photo by Marilyn Swanson) By: Donald L Swanson There are lots of state statutes out there on assignments for benefit of creditors (“ABC”) with really-cool provisions. But the problem with those really-cool provisions is this: they are rarely used. Put plainly: a failing businesses needs to shut its business down efficiently... Continue Reading →
MEDIATBANKRY 