Need impaired class for plan cramdown. Is this too creative?
Posted: Wed Aug 22, 2012 11:55 am
Date: Wed, Aug 22, 2012 at 11:54 AM
Subject: Need impaired class for plan cramdown. Is this too creative?
To: CDCBAA Listserv , CAMFFG ,
NACBA BK , Chapter 11 Issues
Listmates,
Chapter 11 DIP can wants to have a consenting impaired class for plan
cramdown. There is an ORAP lien which was served less than 90 days before
filing. (For out of state colleagues: ORAP is an order to debtor to
appear for judgment debtor's examination by judgment creditor. Service of
the order on the debtor creates a 1 year lien over personal property.) It
can be avoided as a preference and, probably, under 522f.
1. Is it considered to be unethical gamesmanship for a DIP to
a. strategically fail to invalidate a small avoidable lien and
b. strategically leave unexempted a small amount of exemptable
property so this lien would have something to attach to.
2. Does it matter how big is the secured claim of the ORAP lien
creditor? Does it matter if we permitted the ORAP lien creditor to
maintain a $5K secured claim and as a result, one or more mortgage bankers
will lose over $500K in a plan cram down?
3. Does ORAP lien need non-exempt property to attach? Seems like it
would attach to exempt property and will remain valid unless avoided under
522f.
Alik Segal
Alik.Segal@gmail.com
310-362-6157
California Central District
Alik Segal
Alik.Segal@gmail.com
310-362-6157
California Central District
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