Also known as: bankruptcy proceeding · bankruptcy case · insolvency proceedings
Written by attorneys · grounded in primary & secondary sources — see below
A federal judicial or administrative process for administering the estate of an insolvent debtor, adjudicating claims of creditors, and determining whether certain debts or interests survive or are discharged.
Brandon Black borrowed money from Beatrice Brown and later filed for bankruptcy, obtaining a discharge of the debt. After the discharge, Brandon expressly promised Beatrice he would repay the full amount. Beatrice later sues to enforce the promise. The promise is binding because it was made after bankruptcy proceedings had begun.
Brookside Pharmaceuticals owned land subject to a recorded conservation servitude held by a land trust. The company filed for Chapter 11 bankruptcy and sought to sell the land free of the restriction to increase value for creditors. The court denied the request because the servitude is not extinguishable in bankruptcy proceedings.
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Benson Motors filed for bankruptcy and asserted a prepetition breach-of-contract claim against a supplier in the bankruptcy court. The supplier objected that the claim involved private rights traditionally resolved in Article III courts. The bankruptcy court lacked authority to enter final judgment on the claim.
Bei Bai filed for bankruptcy and asserted a state-law tortious interference counterclaim against a creditor who had filed a proof of claim. The bankruptcy court attempted to enter final judgment on the counterclaim. The court lacked constitutional authority because the counterclaim was not necessary to resolve the creditor's claim.
Bobby Brady served as a director of a corporation that made improper payments to his sons. The corporation later entered bankruptcy proceedings. Creditors pursued claims against Bobby's estate for the payments, which were litigated as part of the bankruptcy case.
Brendan Burns filed for bankruptcy and asserted a tort claim alleging interference with an expected inheritance. The opposing party argued the claim belonged exclusively in state probate court. The bankruptcy court could adjudicate the claim because it was an in personam tort action outside the probate exception.
A conservation servitude is not extinguished in bankruptcy proceedings unless a statute expressly requires termination. The bankruptcy estate receives the property subject to the servitude, and creditors cannot demand its removal to increase the value of the estate.
An express promise to pay all or part of an indebtedness discharged or dischargeable in bankruptcy proceedings begun before the promise is made is binding on the promisor.
A bankruptcy court generally may not enter final judgment on a state-law contract claim between private parties because such claims involve private rights traditionally resolved in Article III courts.
…of an estate, the probate of a will, or any other purely probate matter.” 392 F. 3d, at 1133. Provoked by Pierce’s claim in the bankruptcy proceedings, Vickie’s claim, like Carol Ankenbrandt’s, alleges a widely recognized tort. See King v. Acker , 725 S. W. 2d 750, 754 (Tex. App. 1987); 4 Restatement (Second) of Torts § 774B (1977) (“One…