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Chapter 15 of the United States Bankruptcy Code, 11 U.S.C § 101 et seq., which incorporates most of the provisions of the United Nations’ Model Law on Cross-Border Insolvency,[1] was enacted as part of the Bankruptcy Abuse and Consumer Protection Act of 2005. Chapter 15 replaced former 11 U.S.C. § 304, which was been enacted in 1978 to provide specific procedures by which a representative in a foreign bankruptcy proceeding could obtain relief in U.S. courts to facilitate the foreign bankruptcy proceeding.

When an insurance company becomes insolvent, one key issue is the extent to which the insurer's liquidator may recover prior payments made by the insurer. On February 23, 2009, the Supreme Court of Pennsylvania issued a significant decision limiting such recoveries. The court held that payments made by a failed Pennsylvania insurance company in the ordinary course of business are not recoverable by the statutory liquidator of the insolvent insurer.

On February 23, 2009, the Supreme Court of Pennsylvania issued a decision finding that payments made by a failed Pennsylvania insurance company in the ordinary course of business are not recoverable by the statutory liquidator of the insolvent insurer because the payments were not on account of an "antecedent debt" as that term is used in the voidable preference provision of Pennsylvania's Insurance Act.

October 17, 2008 marked the third anniversary of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 ("BAPCPA"). This sweeping bankruptcy reform was designed to eliminate bankruptcy as an option for many would-be filers. While there is no doubt BAPCPA impacted bankruptcy filings both nationally and in West Virginia, recent trends suggest filings are on the rise and could reach pre-BAPCPA levels in the foreseeable future.

The 2005 Boom

One of the significant changes brought about by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 ("BAPCPA") was the treatment of loans secured by automobiles in Chapter 13 cases. Prior to BAPCPA, debtors were permitted to "cram down" the secured portions of automobile loans to the fair market value of the collateral. This often resulted in significant reductions to claims secured by automobiles.

Effective December 1, 2007, the official proof of claim form filed in bankruptcy cases changed. While the basic information included on the proof of claim form remains the same, there are some changes creditors should be aware of which are summarized below.

Creditor Information