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Web posted and Copyright © 1/12/98, American Bankruptcy Institute.

The following abstract summarizes the text of submissions made to the National Bankruptcy Review Commission. The abstract is organized by NBRC working group and topic.

The Final Report of the NBRC can be viewed on-line. To obtain a copy of any document shown below, contact the Center for Legislative Archives, Room 205, National Archives Building, Washington, D.C. 20408. The telephone number is 202/501-5350. Mr. R. Michael McReynolds, Deputy Director, will be able to assist with specific inquiries. (The NBRC documents will be housed at this location until June, 1999. Thereafter, the records will be transferred to the Center's archives in College Park, MD.)

Shopping Centers
IDNameGroupOtherCode
Sec
Cross
Ref
Problem ReferencedProposed Solutions
NBRC-
0001
"Shopping Centers Today"

365502(b)(6)1. Abuse of rejection provisions; 2. Retention of poor mgmt.; 3. Lenient insolvency test1. Absolute limit on time to assume or reject leases; 2. Restrict employment & compensation of senior management in bankruptcy; 3. Permit Shopping Center landlords to serve on creditors' committee prior to filing proof of claim
NBRC-
0001
"Shopping Centers Today"

365502(b)(6)1. Abuse of rejection provisions; 2. Retention of poor mgmt.; 3. Lenient insolvency test1. Absolute limit on time to assume or reject leases; 2. Restrict employment & compensation of senior management in bankruptcy; 3. Permit Shopping Center landlords to serve on creditors' committee prior to filing proof of claim
NBRC-
0439
International Council of Shopping CentersInternational Council of Shopping Centers, not signed by an individual, no address given
1102(a)(2)
Shopping Center landlords must provide post-petition services to the debtor without protections in the Code that are afforded to other creditors, and without the assurance of the landlord's representation on the creditor's committee. Current statutory language in the Code and Federal Rules of Bankruptcy Procedure allow the courts to review the membership of creditors' committees and to appoint additional committees, but does not permit the courts to alter the membership of a creditors' committee.ICSC supports the Chapter 11 Working Group proposal that the statutory language of §1102(a)(2) of the Code be amended to permit the court to review and alter the membership of a creditors' committee. While only interpreted in the commentary describing the proposal, ICSC supports the Working Group's intent to grant the court de novo power to review the membership of a creditors' committee. ICSC believes the court should consider a set of guidelines in asserting its powers for altering the membership of the committee, and sets forth its suggestions of what those guidelines should include.
NBRC-
0668
International Council of Shopping Centers

365
ICSC feels that the suggested deletion of "executoriness" and the "material breach" tests would "completely resontruct the fundamentals of bankruptcy contract law" and would not help matters, but in fact cause further confusion.Do not delete the test of "executoriness" and "material breach" from section 365.
NBRC-
0668
International Council of Shopping Centers



ICSC objects to the proposed substitution of the new concept of "election to breach" in place of the concept of "rejection". ICSC feels that such a change would not materially clarify the concept expressed. Instead of reducing the amount and complexity involving a debtor's decision to reject a prepetition contract, which at the present plays out against a backdrop of fairly well-developed case law, the suggested revieion will necessarily result in a glut of new litigation as the courts struggle to delineate the consequences of a debtor's election to breach.Do not substitute the concept of "election to breach" for the current concept of "rejection".
NBRC-
0668
International Council of Shopping Centers

365544, 547, 548"Professor Westbrook rightly eschews a debtor's use of the rejcetion power to avoid a pre-petition grant of "dominion over a specific asset," where the avoidance of the transfer could not be achieved under sections 544, 547 or 548 of the Bankruptcy Code, and certainly most bankruptcy participants would agree that contract rejection may not be employed in bankruptcy to avoid rights in property created by the contract. ICSC believes, however, that the vast majority of the opportunities to use rejection as an acoiding pposer have been foreclosed by sections 365(h) and (n), and that any revision to clarify that rejection is not an avoiding power should leave untouched such "special interest" remedial provisions.""Rejection is clearly not an avoiding power and section 365 might prudently be amended to so state but the "Special Interest" provisions of that Section should not be deleted."
NBRC-
0668
International Council of Shopping Centers



"Although Professor Westbrook believes that temporary performance and interim protectin orders will somehow make the assumption/rejection process more"fair," it is clear that any such orders will most surely involve the revision of contact [sic} terms to the detriment of the non-debtor party. ICSC would object to any new provision of the Bankruptcy Code which would undermine the protections afforded non-debtor parties to executory contracts and unexpired leases under sections 365(d) (3) and 365(d) (10) of the Bankruptcy Code.
NBRC-
0668
International Council of Shopping Centers



ICSC has "no particularly strenuous objection" to clarifying the option of "assumption" if the intent is to clarify that an "election to perform" and subsequent assignment releases the debtor of the continuing obligations under the assigned contract, or that the "election to perform" is not contingent upon an additional finding that the contract would be assignable under nonbankruptcy law. "ICSC does, however, echo the concerns set forth in the "Competing Considerations" section of the proposal that the concepts of "assumption" and "assignment" have been less problematic than the concept of "rejection" and that the change in terminology will almost inevitably result in additional and unnecessary litigation.""ICSC submits that the concepts of "assumption" and "assignment" are not so far broken as to compel a legislative fix at this time."

 

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