The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) made sweeping changes to the Bankruptcy Code related to individual chapter 11 cases. Unfortunately, these changes were made without any legislative history to provide a statement of congressional intent regarding the new provisions. In addition, there were several aspects of individual chapter 11 cases that were not addressed by the legislation, notwithstanding the existence of similar provisions that are applicable in chapter 13 cases. The aspects of individual chapter 11 cases that need legislative attention include the following:
(1) compensation of officers (11 U.S.C.§ 330(a)(4)(B));
(2) use of property of estate (11 U.S.C.§ 363(b)(l));
(3) dual taxable estates (26 U.S.C.§ 1398);
(4) absolute-priority rule (11 U.S.C.§ 1129(b)(2)(B)(ii)); and
(5) discharge (11 U.S.C.§ 1141(d)(5)).
Republished with permission. The complete article "Need for Bankruptcy Code Reform for Individual Chapter 11 Cases" was published by ABI Journal on September 22, 2023.