Reprinted from September 1998 ABI Journal
Web posted and Copyright © September 1, 1998, American Bankruptcy Institute.
The Private Trustee's Reform Act of 1998 (H.R. 2592) was approved by the House of Representatives by voice vote on August 3. The bill allows standing and panel trustees the right to judicial review of their removal from case rotation, or denial of actual, necessary expenses. After exhausting all available administrative remedies, the trustee may commence an action in the district court, which may in turn refer it to the bankruptcy court for a recommended decision, based solely on a review of the administrative record before the agency. A final order shall be issued by the district court after considering any recommendation from the bankruptcy court. "The decision of the agency shall be affirmed unless it is unreasonable and without cause based upon the administrative record before the agency." The bill is opposed by the Department of Justice/EOUST in its current form. There is no companion bill in the Senate, but the bill may be added to S. 1301 on the Senate floor in September.
The House Banking Committee approved legislation (H.R. 4393) to protect financial markets when a bank or other financial institution fails. The bill would tighten up the requirements for parties to financial transactions and contracts to ensure the enforcement of netting agreements during and after the bankruptcy process. The bill, which was developed by the President's Working Group on Financial Markets, is similar to a provision found in S. 1914, the Senate's business bankruptcy bill. The language in H.R. 4393 may be added to S. 1301 on the Senate floor.
The Home Health Integrity Preservation Act of 1998 (S. 2031), introduced in May by Sen. Grassley (R-IA), amends the Social Security Act to provide that certain Medicare actions against debtors shall not be subject to a stay of bankruptcy proceedings. It also makes certain Medicare debt non-dischargeable in bankruptcy and declares that the repayment of certain Medicare debts shall be considered final and not subject to preference treatment under the Bankruptcy Code. The bill was referred to the Senate Committee on Finance.