On Bankruptcy and Mediation
An early end By: Donald L Swanson “The term of a Subchapter V plan can be less than three years, based upon the language of the statute!” --A Bankruptcy Judge's comment at a bankruptcy conference in December 2019 (as I recall it). Upon hearing that comment, I went scrambling to find the statutory language. And here... Continue Reading →
By: Donald L Swanson Subchapter V trustee compensation is based on an hourly fee. Unlike compensation for a Chapter 7, Chapter 12 or Chapter 13 trustee, a Subchapter V trustee’s compensation has nothing to do with the amount of funds disbursed. That’s the conclusion of a Bankruptcy Court opinion: In re Tri-State Roofing, Case No. 20-40188,... 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 →
“Currently" engaged in flying By: Donald L Swanson In re Blanchard, Case No. 19-12440, Bankr. E.D. La. (Doc. 137, decided 7/16/2020), is a Subchapter V eligibility opinion. The opinion stands for two propositions: Subchapter V exists to help small businesses reorganize; andNothing in Subchapter V, or in the definition of a small business debtor, requires a... Continue Reading →
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