On Bankruptcy and Mediation
Not eligible for roaming the prairie (photo by Marilyn Swanson) By: Donald L Swanson QUIZ – Multiple Choice Question Question: Where is this bankruptcy eligibility language found: “aggregate noncontingent liquidated secured and unsecured debts as of the date of the filing of the petition or the date of the order for relief in an amount not... Continue Reading →
Co-existing, side-by-side (photo by Marilyn Swanson) By: Donald L Swanson A little-known effect of the enactment of Subchapter V is this: Prior “small business debtor” rules now co-exist, side-by-side, with (and separately from) Subchapter V rules in Chapter 11; andWe have two separate-but-similar systems for small business debtors. A Chronology Consider this chronology of changes that... Continue Reading →
By: Donald L Swanson It happens. There are businesses in financial stress who, for a variety of reasons, can’t qualify for Subchapter V. Owners want to save the business, but Subchapter V is not available. Reasons why Subchapter V might be unavailable include: Debtor has more than $7.5 million of qualifying debt and can’t get enough... Continue Reading →
A permanent extender? (photo by Marilyn Swanson) By: Donald L. Swanson The Small Business Reorganization Act of 2019 (aka “Subchapter V”) has been in effect since February 19, 2020. And here’s something we’ve learned since then: Subchapter V meets a definite need in our society for helping small businesses and owners in financial stress. I’ve seen... Continue Reading →
The path to confirmation? (Photo by Marilyn Swanson) By: Donald L Swanson 11 U.S.C. § 1191 is Subchapter V’s plan confirmation statute. One confirmation essential, from § 1191(b), is that a Subchapter V plan must be “fair and equitable” to each impaired class that does not accept the plan. This article summarizes two bankruptcy court opinions... Continue Reading →
Voting (photo by Marilyn Swanson) By: Donald L Swanson In Subchapter V of the Bankruptcy Code, the “Post-Petition Disclosure and Solicitation” provisions of § 1125 do not apply without a specific court order (see § 1181(b)). Voting Questions So, a question exists on how the plan voting provisions of § 1126 and Fed.Bankr.R. 3018 might apply... Continue Reading →
Well-defined limits (photo by Marilyn Swanson) By Donald L. Swanson The opinion is In re Parking Management, Inc., Case No. 20-15026, in the Maryland Bankruptcy Court (decided August 28, 2020, Doc. 224). The Question The question is whether Debtor has too much debt to qualify for Subchapter V relief. Background —Subchapter V The new Subchapter V... Continue Reading →
Custodians By: Donald L Swanson The case is, In re U.S.A. Parts Supply, Cadillac U.S.A. Oldsmobile U.S.A., L.P., Case No. 20-bk-241, U.S. Bankruptcy Court, Northern West Virginia (decided Aug. 17, 2020, Doc. 143). On March 22, 2020, Debtor files a voluntary Chapter 11 petition under Subchapter V as a small business debtor. Creditors promptly file a... Continue Reading →
An election system and process (photo by Marilyn Swanson) By: Donald L Swanson Wow—didn’t expect to see an § 1111(b) election opinion under Subchapter V this soon! But here it is: In re Body Transit, Inc. d/b/a/ Rascals Fitness, Bky. No. 20-10014 in Eastern Pennsylvania Bankruptcy Court (decided August 7, 2020, by Hon. Eric. L. Frank,... Continue Reading →
The wheels of commerce must continue to turn (photo by Marilyn Swanson) By: Donald L Swanson Under UCC § 9-332, a debtor’s attorney can receive, and keep, pre-petition retainers paid from a lender’s collateral proceeds—absent collusion. That’s the conclusion of a recent Bankruptcy Court opinion in Walters v. Lynch (In re 3P4PL, LLC), Adv. No. 15-1120,... Continue Reading →
