U.S. courts generally agree that the substantive consolidation should be applied sparingly, and even more so when substantive consolidation of debtors with non-debtors is sought. While many opinions address the grounds for substantive consolidation, very few cases address standing and notice issues when the sought for consolidation is of non-debtor entities. The Oklahoma bankruptcy court recently addressed these two issues in SE Property Holdings, LLC v. Stewart.
Under section 1111(b) of the U.S. Bankruptcy Code, a non-recourse secured creditor that holds “a claim secured by a lien on property of the estate” is granted recourse against the bankruptcy estate upon the filing of a chapter 11 bankruptcy petition. But what happens when there has been a post-petition foreclosure on such property, so that it is no longer part of the estate and the liens have been extinguished? Can the creditor still use section 1111(b) to assert a claim against the bankruptcy estate? The Ninth Circuit answered no in Matsan v.
In positive news for financiers and lenders, the Irish Government has signed an order which gives immediate effect to the “Alternative A” insolvency provisions of the Cape Town Convention.
The High Court has recently expressed concern that distressed borrowers are being duped into paying money to the anonymous promoters of schemes, which purport to protect them from enforcement by lenders but are actually ‘utterly misguided and spurious’.
There are a number of schemes being promoted at the moment that supposedly protect borrowers in arrears from enforcement by their lender.
Recent Developments in Acquisition Finance
A U.S. House of Representatives Bill would amend the Bankruptcy Code to establish new provisions to address the special issues raised by troubled nonbank financial institutions.
Two recent developments may have rendered the Irish legal system less attractive to creditors. We examine the scope of these developments and the likely impact on debt collection activity in Ireland.
Rate of interest of judgment debts falls by 6%
The rate of interest on judgment debts has been reduced from 8% to 2%, with effect from 1 January 2017, in accordance with the Courts Act 1981 (Interest on Judgment Debts) Order 2016 (S.I. No 624 of 2016) (the “Order”).
In a highly anticipated bankruptcy opinion, the United States Supreme Court, in Czyzewski v. Jevic Holding Corp., held that courts may not approve structured dismissals providing for distributions that deviate from the priority rules prescribed in the Bankruptcy Code, absent consent of the affected creditors.
Companies that the Financial Stability Oversight Council (FSOC) believes may be subject to FDIC receivership under the Orderly Liquidation Authority contained in Title II of the Dodd-Frank Act, and certain of their affiliates, are now subject to recordkeeping requirements related to their “qualified financial contracts”1 (QFCs).
A debtor ordinarily may discharge debts in bankruptcy, unless one of several exceptions apply. One of the preclusions to dischargeability of certain debts, found in Section 523(a)(19) of the U.S.