BAPCPA Nearly Backfires (Rose v. Portfolio — Cert. Denied)

A backfire (photo by Marilyn Swanson) By: Donald L Swanson “Backfire” = “to have the reverse of the desired or expected effect”  --from Merriam-Webster.com In 2005, the U.S. Congress decided to make life hard for individuals in bankruptcy.  Congress saw fraudulent intent in the minds of their destitute constituents—particularly those who had been living above the... Continue Reading →

Document Retention Rules in Bankruptcy: Holding Onto the Past

Holding onto the past (photo by Marilyn Swanson) By: Donald L. Swanson Do you have any fuddy-duddies in the family holding onto the past: they refuse to get a computer or smart phone or to use email or text messaging? If so, family communications require someone to pass-on information by snail mail or telephone—if anyone bothers... Continue Reading →

First-Ever U.S. Bankruptcy Law — Enacted With A Pandemic’s Help

The Bankruptcy Act of 1800 By: Donald L Swanson 1800 is the year Congress adopts its first bankruptcy law under the "Bankruptcies" clause of the newly-ratified U.S. Constitution. Congress’s Bankruptcy Act of 1800 is modeled after England’s bankruptcy laws.  But there is a significant difference: the focus of England’s bankruptcy laws, back then, is exclusively on... Continue Reading →

Constitutionality of Third Party Releases (In re Millennium Lab)

By: Donald L Swanson Released water (photo by Marilyn Swanson) The opinion is In re Millennium Lab Holdings II, LLC, et al., 945 F.3d 126 (3d Cir. 2019).  On March 18, 2020, a Petition for writ of certiorari is filed from this opinion (Supreme Court Case No. 19-1152).  On May 26, 2020, the Supreme Court denies... Continue Reading →

Subchapter V: Eligibility And Mortgage Impairment For A Residence/Bed & Breakfast (In re Ventura)

A Bed & Breakfast (photo by Marilyn Swanson) By: Donald L Swanson Chapter 11 Debtor owns her home and uses it as a Bed & Breakfast. The mortgage on Debtor's B&B/residence is her primary debt. This raises Subchapter V issues like: Eligibility—is her primary debt a consumer debt or a business debt?Eligibility—is her bankruptcy a "single... Continue Reading →

Subchapter V: To Be Construed Openhandedly For Debtor (In re Wright)

By: Donald L Swanson Subchapter V exists "to improve the reorganization process for small business chapter 11 debtors." In re Wright, Case No. 20-01035 (Bankry.S.Car., Order dated 4/27/2020, Doc. 37 at 5). Charles Wright (“Debtor”) files a Chapter 11 case on February 28, 2020, designating himself a small business debtor and electing to proceed under Subchapter... Continue Reading →

Available Cash: Crucial Element for Reorganizing a Family Business in Chapter 11

By: Donald L Swanson Cash in a business is like blood in a body: without it, you die! A Huge Challenge Cash availability is a huge challenge for family businesses in bankruptcy. Here’s why: Running out of cash is a common symptom of financial stress that leads to bankruptcy; and A bankruptcy filing will magnify that... Continue Reading →

BAPCPA: A Wrong-Headed Reversion to the Idea of Punishing Debtors

By:  Donald L. Swanson Over the years, there have been some really-bad ideas for punishing debtors. Examples from Olden Times Under Draco’s Law, back in Athens of the 600s, death and dismemberment could be a debtor’s fate (not sure which occurred first), with sale into slavery as an alternative. Fast forward to Merry Olde England... Continue Reading →

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