CORPORATIONS - REORGANIZATION - EXPEDITION REQUIRED UNDER SECTION 77B IN AGREEING UPON AND PRESENTING ACCEPTABLE PLAN

Authors

Abstract

B corporation filed its petition for reorganization under Section 77B of the Bankruptcy Act. This was contested by answer of bondholders' committee and certain minor creditors as provided for in Section 77B (a) on the ground that reorganization was not in the best interests of the preserving of assets. Held, there is no reason to believe that with a fair and equitable plan of reorganization there would be no substantial equities; therefore, the petition is received and B is allowed to proceed under Section 77B and to present within a reasonable time some plan of reorganization as provided by Section 77B (c) 8; that since Section 77B is primarily for rehabilitation of the debtor, this factor should be considered in fixing a reasonable time, but this does not mean that these proceedings can remain in court indefinitely; the plan must be presented with reasonable promptness in order not to obstruct the usual progress of diligent creditors, particularly those possessing dominant liens, seeking other remedies. In re Bush Terminal Co., (D. C. N. Y. 1935) 10 F. Supp. 315.

Recommended Citation

CORPORATIONS - REORGANIZATION - EXPEDITION REQUIRED UNDER SECTION 77B IN AGREEING UPON AND PRESENTING ACCEPTABLE PLAN, 34 Mich. L. Rev. 290 (1935).
Available at: https://repository.law.umich.edu/mlr/vol34/iss2/12