Law.com Subscribers SAVE 30%
Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.
Equipment Rentals in Bankruptcy: Allocation Issues Arising from Post-Petition Payments
Courts frequently wrestle with how to apply post-petition payments for rental proceeds deriving from lenders' pre-petition collateral. The issue arises principally in single asset real estate cases, because generally post-petition proceeds of the debtor are the rents attributable to the lender's collateral.
The issue is not solely the province of single asset real estate cases, however. In many equipment financing situations, such as the financing of aircraft for chartering and inventory for equipment rental companies in which equipment is then subleased to third parties etc., the equipment lender takes a security interest in the third-party rental proceeds in addition to the equipment itself. If the customer files for bankruptcy protection, how bankruptcy courts deal with third-party rental proceeds can significantly impact the total dollar amount realized on the equipment lender's claim.
Based on developing case law coming out of single asset real estate cases, a rationale is emerging that allows the application of the pre-confirmation rental proceeds to the unsecured portion of the lender's claim. This treatment has the effect of reducing the unsecured portion of the lender's claim on a dollar-for-dollar basis and allows the lender to receive what is essentially a distribution on its unsecured claim ahead of other unsecured creditors. This article explores some of the issues surrounding post-petition rental proceeds and the ways courts have applied those payments to lenders' claims and suggests ways of using the intellectual framework established by those cases to argue for similar application in the context of an equipment lender's security interest in third-party rental proceeds.
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Removing Restrictive Covenants In New York
In Rockwell v. Despart, the New York Supreme Court, Third Department, recently revisited a recurring question: When may a landowner seek judicial removal of a covenant restricting use of her land?