On Bankruptcy and Mediation
Surviving some heat (photo by Marilyn Swanson) By: Donald L Swanson There are two bankruptcy court opinions—issued a week apart. One converts a Chapter 11 case, involuntarily, to a case under Chapter 7. The Chapter 11 Debtor in the other opinion survives a similar conversion effort—but just barely and due to unique circumstances. A comparison and... Continue Reading →
Utilizing and gaining experience from another (photo by Marilyn Swanson) By: Donald L Swanson It’s been a while—quite a long while, actually—since bankruptcy cases were booming. A Problem The result of such time lag is this: younger attorneys have missed-out on opportunities to grow in the bankruptcy realm; andthe bankruptcy bar is aging, without adequate development... Continue Reading →
Activity (Photo by Marilyn Swanson) By: Donald L Swanson A recent Bankruptcy Court opinion, In re Offer Space, LLC, [fn. 1] adds an important statutory distinction to the “engaged in” criterion analysis for Subchapter V eligibility, under § 1182(1)(A). The distinction is this (emphasis added): § 1182(1)(A) refers to a person “engaged in commercial or... Continue Reading →
Opposing views (photo by Marilyn Swanson) By: Donald L Swanson To be eligible for Subchapter V relief, the debtor must be “a person engaged in commercial or business activities” (§ 1182(1)(a)). Opposing Views Opposing views are developing on how this “engaged in” criterion should be applied. One view says, (i) nothing requires a debtor to be... Continue Reading →
Removed (photo by Marilyn Swanson) By: Donald L Swanson When a Subchapter V debtor is removed from possession, the Subchapter V trustee steps into the possession role. That’s according to statute. Statutes Here are the statutory provisions (emphasis added): 11 U.S.C. § 1182(2) is titled, “Debtor in Possession” and says, “The term ‘debtor in possession’ means... Continue Reading →
Normal activity cannot exist (photo by Marilyn Swanson) By: Donald L Swanson The automatic bankruptcy stay: “does not apply in a case in which the debtor— . . . (B) was a debtor in a small business case that was dismissed for any reason by an order that became final in the 2-year period” before the... Continue Reading →
COVID-19 Bankruptcy Relief Extension Act of 2021 By: Donald L Swanson It's finally happened -- on bi-partisan and nearly-unanimous votes. The $7.5 million debt limit for Subchapter V eligibility, set to expire on March 27, 2021, is extended. Yet, it took a March 2021 fire drill to do so (see this webpage), which fire drill concluded... Continue Reading →
Timing (photo by Marilyn Swanson) By Donald L. Swanson Here are opposing Subchapter V discharge rules—based on whether the plan is confirmed consensually or non-consensually: Consensual Confirmation. “If a plan is consensual and confirmed under Section 1191(a), the debtor receives a discharge under Section 1141(d)”; butNon-Consensual Confirmation. If a plan is non-consensual and confirmed under Section... Continue Reading →
Sunset (photo by Marilyn Swanson) By: Donald L Swanson March 27, 2021, is the sunset date for Subchapter V’s eligibility debt limit of $7.5 million. At the stroke of midnight, that coach will turn back into a $2.7 million pumpkin. So . . . where is the action in Congress to extend that $7.5 million limit? ... Continue Reading →
A first day? (photo by Marilyn Swanson) By: Donald L Swanson Here is a Hard-Knocks Rule (i.e., a lesson I’ve learned the hard way): A plan of reorganization needs to be a first-day filing—or as close to that as possible. This lesson first imposed itself upon me three decades ago. I’m representing a Chapter 11 debtor,... Continue Reading →
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