In the recent case of Re Avanti Communications Limited (in administration) (Re Avanti), the court considered the nature of fixed and floating charges. Whether a charge is fixed or floating has implications for both lenders and administrators in terms of determining to what extent a chargor can recover from the charged assets and to what extent a borrower can deal with its assets.

Background of case:

Section 503(b)(9) Overview

Bankruptcy Basics for New and Non-Bankruptcy Attorneys

This entry is part of Nelson Mullins’s ongoing “Bankruptcy Basics” blog series that is intended to address foundational aspects of bankruptcy for new and non-bankruptcy practitioners and professionals. This entry will discuss the general structure of bankruptcy claims and the differences between how unsecured, secured, and priority claims are treated in a bankruptcy case.

A “claim” against a bankruptcy estate is defined as a:

On April 17, 2023, the Fifth Circuit Court of Appeals, in Matter of RE Palm Springs II, L.L.C., 2023 WL 2966520 (5th Cir. April 17, 2023), held that a senior lender who uses economic leverage and asserts its legal rights to squeeze out a junior lender remains a good faith purchaser entitled to declare an appeal moot based on a sale under section 363(m) of the Bankruptcy Code. Key to the Fifth Circuit’s opinion was the fact that the actions in question were disclosed to the bankruptcy court in advance of it making the section 363(m) finding.

Facts

Non-profits are just like for-profit companies in that they can be faced with significant financial challenges for which bankruptcy provides an opportunity for restructuring or liquidation for the benefit of their creditors and other stakeholders. Many times, particularly in the areas of healthcare and religious institutions, non-profit bankruptcies raise complex and novel insolvency issues. This blog post discusses four of the unique aspects of non-profit bankruptcies.

1. Non-profits are not subject to involuntary bankruptcy.

In MOAC Mall Holdings v. Transform Holdco, the Supreme Court of the United States addressed whether Section 363(m) of the Bankruptcy Code―which limits the effect of certain appeals on orders authorizing the sale or lease of bankruptcy estate property―is a jurisdictional provision.

Bankruptcy lawyers recently gained access to a promising technology for improving the efficiency of tasks like drafting a motion for relief from stay. ChatGPT allows users to employ generative artificial intelligence by chatting with a chatbot on OpenAI’s website https://chat.openai.com/chat.

This entry is part of Nelson Mullins’s ongoing “Bankruptcy Basics” blog series that is intended to address foundational aspects of bankruptcy for new and non-bankruptcy practitioners and professionals. This entry will discuss the general structure of bankruptcy cases and the differences between “adversary proceedings” and “contested matters.”

You represent the unsecured creditors committee in a complex Chapter 11 case, where you have reason to believe that the debtor’s officers and directors have, and continue to, engage in self-dealing and are breaching their fiduciary duties by not advancing a plan in the best interest of creditors. So, the committee asks you to seek the appointment of an examiner to investigate.

In a unanimous decision handed down on Feb. 22, 2023, the Supreme Court reinforced one of the Bankruptcy Code’s important creditor protections. In Bartenwerfer v. Buckley, No. 21-908, 598 U.S. ___ (2023), the Court confirmed, in an opinion authored by Justice Barrett, that the Bankruptcy Code bars the discharge by individual debtors of debts fraudulently obtained by the debtor’s agent or business partner.