U.S. Bankruptcy Judge Martin Glenn recently decided that a fully-negotiated agreement would not be enforced in the absence of required signatures. The agreement contemplated a settlement between the General Motors bankruptcy trust and car purchasers and accident victims of General Motors cars following an alleged vehicle defect; both parties fully and unambiguously agreed to be bound by the terms of the agreement.

The decision of the United States Court of Appeals for the Second Circuit in In re Motors Liquidation Company is yet the latest case to show the difficulty in using the bankruptcy process to resolve tort claims.[1]

The Background Basics