On Bankruptcy and Mediation
By: Donald L. Swanson Three bankruptcy bills recently navigated the political morass in Washington D.C. and became law on August 23, 2019. The three new laws are: Small Business Reorganization Act of 2019 (H.R. 3311) Family Farmer Relief Act of 2019 (H.R. 2336) HAVEN Act (H.R. 2938). On August 29, 2019, the American Bankruptcy Institute ("ABI")... Continue Reading →
By: Donald L. Swanson “I stand at the window of a railway carriage which is traveling uniformly, and drop a stone on the embankment . . . I see the stone descend a straight line. A pedestrian who observes the misdeed from the footpath notices that the stone falls to the earth in a parabolic curve.... Continue Reading →
By: Donald L. Swanson Congress adopted Chapter 12 in 1986. Then, in 2005, Congress added special tax provisions to Chapter 12 at § 1222(a)(2)(A). Those provisions made taxes arising from sales of farm assets dischargeable as general unsecured claims. In re Knudsen The IRS didn’t like this new law and worked to limit its effect. That... Continue Reading →
By: Donald L. Swanson “Back when I was in school . . .” This is a tired-old phrase, usually followed by tales of hardship. The Olden Days But here’s an opposite twist: Back when I was in college (during the 1970s), you could actually pay your way through, with little-to-no debt, by working part-time jobs... Continue Reading →
By Donald L. Swanson Every now and then a mediator gets stiffed on fees. It doesn’t happen often. But it happens. And it’s always a shame. Mediators of bankruptcy disputes have an additional payment-related hurdle they must navigate. The hurdle is this: --Advance court approval is required for getting paid from bankruptcy funds. Statutory Requirements... Continue Reading →
On July 30, 2019, Kristine Tidgren of Iowa State University and I presented a webinar for farmers titled, "Financial Impairment on the Farm." My portion of the webinar focuses on, "What's a farmer to do when the bank wants out?" Kristine's portion focuses on related tax issues. Here's a link to the webinar: Link: YouTube audio... Continue Reading →
By: Donald L Swanson The automatic stay is one of the basics of our bankruptcy laws. It’s a foundational rule for the entire bankruptcy system. But that hasn’t always been the case. In fact, the U.S. Supreme Court, in a Depression-era case, had to decide whether a bankruptcy stay is constitutionally permissible. And, fortunately, the Supreme... Continue Reading →
By: Donald L Swanson Merchant cash advance loans provide ready-cash for businesses in desperate need of cash. Because of the desperation, terms of merchant cash advance loans can be oppressive. For example: Repayments are made daily—by automatic cash withdrawals from debtor’s bank account; Rates of return, if repaid as scheduled, often range from 50% per annum... Continue Reading →
By Donald L. Swanson On July 25, 2019, the U.S. House of Representatives passes on voice vote H.R. 2336, which raises the debt limit for Chapter 12 eligibility from $4.4 million to $10 million. And both parties voted, "Aye"! Who would've thunk it: bi-partisan action by a partisan political body, in today's political environment?! The subject... Continue Reading →
By Donald L. Swanson It’s been 40 years since enactment of the Bankruptcy Code [Fn. 1]. And the Code has been highly effective in many contexts. But the Bankruptcy Code is, and always has been, inadequate for the needs of small businesses and entrepreneurs in financial stress. Congress needs to address this deficiency. What Works &... Continue Reading →
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