On May 15, 2012, the United States Court of Appeals for the Eleventh Circuit held that security interests and liens granted by subsidiaries of a borrower to refinance obligations owed to the borrower’s lenders constituted fraudulent transfers under section 548(a)(1) of the Bankruptcy Code in the borrower’s and subsidiaries’ bankruptcy cases.Senior Transeastern Lenders v. Official Committee of Unsecured Creditors (In re TOUSA, Inc.), 2012 WL 1673910 (11th Cir. 2012).
On May 11, 2012, the U.S. Court of Appeals for the Seventh Circuit issued a decision in BMD Contractors, Inc. v. Fidelity and Deposit Company of Maryland (No. 11-1345), affirming a lower court summary judgment in favor of a surety on a payment bond.
The United States Bankruptcy Court for the Central District of Illinois recently held that an Illinois mortgage is subject to avoidance in bankruptcy pursuant to 11 U.S.C. § 544(a)(3) unless the mortgage contains among other things, (i) the amount of the debt, (ii) the maturity date of the debt, and (iii) the underlying interest rate. Richardson v. The Gifford State Bank (In re Crane), Adv. Pro. No. 11-9067 (Bankr. C.D. Ill.).
As of January 1, 2012, the Slovak Act on Bankruptcy and Restructuring (Act No. 7/2005 Coll.) has been amended to introduce a statutory subordination of claims of related credi-tors (Section 95(3) of the Slovak Bankruptcy Act). The Amendment affects the ability of creditors to obtain satisfaction from companies in bankruptcy by classifying claims by “related” parties as subordinate to other claims.
In their study published in February's issue of The Quarterly Journal of Economics, “Long-Run Impacts of Unions on Firms: New Evidence from Financial Markets, 1961–1999,” Princeton University Professor David Lee and University of California Professor Alexandre Mas estimated that an “average union effect on the equity value of the firm equivalent to $40,000 per unionized worker.” The professors noted that the loss was a combination of a transfer of wealth to workers and inefficiencies caused by the unions.
- Introduction
On Feb. 29, 2012, a Michigan citizens’ group opposed to the State of Michigan’s emergency financial manager law (officially entitled “Local Government and School District Fiscal Accountability Act,” MCL §§ 141.1501 et seq. and referred to herein as the “Act”), filed petitions to place the issue of the Act’s rejection on the state ballot in November.
A proposed bill entitled the Nonrecourse Mortgage Loan Act and recently introduced to the Senate for the State of Michigan would regulate the use and enforceability of certain loan covenants in non-recourse commercial transactions. Presumably, the bill, Senate Bill No. 992 introduced on Feb. 29, 2012 and referred to the Committee on Economic Development, is in reaction to a recent decision of the Michigan Court of Appeals finding a guarantor liable for a deficiency claim notwithstanding the non-recourse nature of the loan. See Wells Fargo Bank, NA v. Cherryland Mall Ltd.
One of the primary objectives of the reformed Austrian Insolvency Act ("IO"), which entered into force on 1 July 2010, has been to increase the number of successful corporate reorganisations and to facilitate the continuation of business operations during financial crises. After the initiation of insolvency proceedings, the creditors of an insolvent debtor shall not be entitled to revoke or terminate contracts that are essential for continuing the debtor’s business operations.
Coherent and clear rules for restructuring proceedings
The economic crisis presents a real-life test for the Slovenian insolvency legislation, unequalled in its young history. Numerous insolvency proceedings against Slovene companies have revealed several serious flaws of the Insolvency Act and forced the legislator into continuous amendments.
Recent amendments to the Enforcement Procedure and the Interim Protection Act facilitate repayment in enforcement proceedings.
Introduction
Bills of exchange are mostly regulated by the sector specific act of 1946 (based on provisions of three 1930’s Geneva conventions). Provisions of other acts (eg, Obligation Code; Obligacijski zakonik) are used secondarily if the Bill of Exchange Act (Zakon o menici) does not contain applicable provisions.