Recent court decisions in the state of Michigan—Wells Fargo Bank, NA v. Cherryland Mall, ____ N.W.2d _____, 2011 WL 6785393 (Mich.App. 2011) (Cherryland) in the Michigan intermediate appellate court and 51382 Gratiot Avenue Holdings Inc. v. Chesterfield Development Company, 2011 U.S. Dist. LEXIS 142404 (E.D. Mi. Dec.
The usual Friday release of a large number of letter rulings by the IRS included several rulings of interest on reorganizations and consolidated return issues.
On 25 January 2012, the Irish Government published the heads of a proposed new law, the Personal Insolvency Bill, which, it states, has the aim of providing “a new approach to dealing with insolvency” in Ireland.
While bankruptcy law and tort law may not seem related, it is important to know if your client has ever gone through a bankruptcy and, if so, the terms of its plan of reorganization. A recent Eighth Circuit decision confirmed the importance of knowing the ins and outs of a client’s bankruptcy and the terms of the applicable plan.
On December 22, 2011, the United States Bankruptcy Court for the District of Delaware inIn re JER/Jameson Mezz Borrower II LLC 1 dismissed with prejudice a mezzanine borrower’s bankruptcy case for bad faith under Section 1112(b) of the Bankruptcy Code. In doing so, the court clarified that the standard in the Third Circuit to evaluate the good faith of a debtor seeking shelter under the umbrella of Chapter 11 of the Bankruptcy Code is an objective one and does not consider the subjective good faith of a debtor as do courts within the Secon d Circuit.
Generic Legal Advice Memorandum AM 2011-003 (August 18, 2011)
Overview
The new bankruptcy provisions contained in the Civil Law (Miscellaneous Provisions) Act 2011 were commenced yesterday. The Act has been in force since 2 August.
The new provisions allow for automatic discharge on the 12th anniversary of a bankruptcy adjudication order and a reduction in the period for application for discharge from bankruptcy to five years from 12 years.
The Civil Law (Miscellaneous Provisions) Act 2011 was signed into law by the President on 2 August 2011. The Act provides for certain provisions, concerning private security services, bankruptcy and family mediation services, to come into operation on such days as the Minister for Justice and Equality, by order, appoints. All other provisions of the Act came into force on 2 August.
The Act introduces a number of important reforms across a broad range of areas, including:
The Second Circuit Court of Appeals has now weighed in on the Bankruptcy Code’s safe harbor provisions. In Enron Creditors Recovery Corp. v. Alfa, S.A.B. de C.V., Docket Nos. 09–5122, 09–5142, 2011 WL 2536101 (2d Cir. June 28, 2011), the Second Circuit Court of Appeals faced an issue of first impression—whether Section 546(e) of the Bankruptcy Code, which shields certain payments from avoidance actions in bankruptcy, extends to an issuer’s payment to redeem its commercial paper made before maturity.
In Lehman Brothers Special Financing, Inc. v. Ballyrock ABS CDO 2007-1 Limited (In re Lehman Brothers Holdings, Inc.), Adv. P. No. 09-01032 (JMP) (Bankr. S.D.N.Y. May 12, 2011) [hereinafter “Ballyrock”], the United States Bankruptcy Court for the Southern District of New York held that a contractual provision that subordinates the priority of a termination payment owing under a credit default swap (CDS) to a debtor in bankruptcy, and which caps the amount of the termination payment, may be an unenforceable ipso facto clause under section 541(c)(1)(B).