Book Description
This digital document is an article from Business Credit, published by National Association of Credit Management on May 1, 2003. The length of the article is 2781 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.Citation Details
Title: Appellate Court reverses Kmart order approving favorable treatment of critical vendors' pre-petition unsecured claims. (Credit Column).
Author: Bruce S. Nathan
Publication: Business Credit (Magazine/Journal)
Date: May 1, 2003
Publisher: National Association of Credit Management
Volume: 105 Issue: 5 Page: 34(4)Distributed by Thompson Gale
Excerpt. © Reprinted by permission. All rights reserved.
Introduction
The pre-bankruptcy claims of "critical vendors" (eliciting support from the "haves" and frustration and a sense of unfairness from the "havenots") has just been turned on its head! In recent years, the trend in court decisions has been to approve (and in many instances rubberstamp) the requests of debtors to pay the pre-petition unsecured claims of vendors the debtor designates as "critical vendors", and whose goods and services the debtor considers essential to the survival of the debtor's business. The courts have granted this relief despite the general rule that prepetition unsecured claims are at the bottom of the claims priority ladder, and all pre-petition unsecured creditors are supposed to be treated the same way in bankruptcy...
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