Bankruptcy laws: what is fair?
Current world conditions have demonstrated the interdependency of credit markets and
bankruptcy laws.
Market economies need a system of fair, predictable and consistently
enforced laws and procedures to deal with financial...
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Bankruptcy laws: what is fair?
Current world conditions have demonstrated the interdependency of credit markets and
bankruptcy laws.
Market economies need a system of fair, predictable and consistently
enforced laws and procedures to deal with financial failure.
There are, however, no
“right” and “wrong” answers to the question “What is a fair statutory scheme of
bankruptcy laws and procedures”? The following article highlights a number of
bankruptcy policy considerations for ascertaining fairness with respect to the treatment
of secured creditors.
To non-insolvency specialists, bankruptcy law is not easily understood.
Bankruptcy itself
seems contrary to the notions of fair play and substantial justice.
Specifically, bankruptcy
laws often obliterate contractual bargains that were time-consuming to negotiate and
implement.
Plain and simple, bankruptcy means that creditors will not receive the benefit
of their bargains and, in most cases, will lose money.
To most, “bankruptcy fair
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