The Companies and Intellectual Property Commission (CIPC) issued a Business Rescue Proceedings Report (Business Rescue Report) on business rescue proceedings from its inception on 1 May 2011 to 31 December 2021 – a “ten-year” scorecard. It takes stock of how business rescue has developed over that period and whether South Africa has matured as a late entrant into the playing field of corporate restructuring regimes. The story must be told over the “ten-year” period and dissected into two parts: pre- and post-pandemic.

Chapter 6 of the Companies Act, 2008 affords a financially distressed company a fighting chance to restructure its financial obligations and avoid the destruction of value through liquidation for the duration of its formal chapter 6 business rescue proceedings. Such a moratorium is not available if a company seeks to conclude a restructure through a compromise or arrangement with all its creditors or members of any class of creditors.

In its top consumer credit law decisions of 2021, the U.S. Court of Appeals for the Fifth Circuit determined that settlement of an FDCPA claim does not trigger an attorney fee award, examined third-party contact as a “communication” under the FDCPA, and ruled there was no “partial surrender” of collateral in a Chapter 13 plan.

Tejero v. Portfolio Recovery Assocs., LLC, 993 F.3d 393 (5th Cir. 2021)

When 2020 ended, many of us were unsure what 2021 would look like from a bankruptcy perspective. Would consumer filings increase? Could we see bankruptcy reform and particularly in the area of discharge of student loans? There was a lot to consider throughout the year. This article will provide some insight as to what we saw and where we may be headed in 2022.

Bankruptcy Filings Down in 2021

Bankruptcy filings through the first 11 months of 2021 were at their lowest levels since the 1980’s.

On March 23, 2020, we commented on the Quebec Court of Appeal’s decision in the Arrangement relating to Consultants SM inc. case. The City of Montreal (the “City”) appealed this decision to the Supreme Court of Canada and the appeal was heard on May 20, 2021.

On December 10, 2021, the Supreme Court of Canada (the “Supreme Court”) dismissed the City’s appeal, thereby rendering an important decision with respect to “pre-post compensation” and “non-dischargeable debts” under the Companies’ Creditors Arrangement Act (the “CCAA”).

The U.S. Court of Appeals for the Seventh Circuit recently affirmed the dismissal of several actions by a borrower against a mortgagee, and in so ruling also held that it did not have jurisdiction to review the lower court’s remand order, and that the borrower had waived his right to challenge an award of attorney fees and costs in connection with the remand.

Le 23 mars 2020, nous avons commenté l’arrêt de la Cour d’appel du Québec dans le dossier Arrangement relatif à Consultants SM inc. La Ville de Montréal (la « Ville ») a porté cet arrêt devant la Cour suprême du Canada et l’audition du pourvoi a eu lieu le 20 mai 2021.

The U.S. Court of Appeals for the Fifth Circuit recently rejected a borrower’s objections to a bankruptcy court’s jurisdiction and held that the doctrine of res judicata barred the borrower’s claim objection as it was ultimately based on the alleged impropriety of the creditor’s claim from a prior bankruptcy.

A copy of the opinion in BVS Construction v. Prosperity Bank is available at: Link to Opinion.

The Appellate Court of Illinois, Second District, recently affirmed a trial court’s ruling denying a borrower’s motion to vacate the default judgment of foreclosure against him and confirming the judicial sale of the borrower’s property.

The U.S. Court of Appeals for the Eleventh Circuit recently ruled that a debtor’s appeal of a sale order was statutorily mooted by Subsection 363(m) of the Bankruptcy Code.

In so ruling, the Eleventh Circuit held that: (1) while the Bankruptcy Code bars relief for an appeal pursuant to 11 U.S.C. § 363(m), it does not defeat jurisdiction; and (2) Subsection 363(m) applies to appeals from any sale authorized by the bankruptcy court, not just those properly authorized by the Bankruptcy Code.