Legal corpus: U.S. Code titles 1–11 from pinned OLRC XML (11,050 sections)
Raw OLRC USLM XML zips @ release 119-100 (retrieved 2026-07-04 via Atlas depot), ingested with the standard pipeline: raw snapshot -> per-section OKF markdown -> manifest + checksums. Title 52 untouched. LegalText: 171 -> 11,221. Titles 12-54 await a clean OLRC retry. Co-Authored-By: Claude Opus 4.8 <noreply@anthropic.com>
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---
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type: "LegalText"
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title: "11 U.S.C. § 701"
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description: "Interim trustee"
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jurisdiction: "us"
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corpus: "united_states_code"
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kind: "code_section"
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title_number: 11
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title_name: "BANKRUPTCY"
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chapter_number: "7"
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chapter_name: "LIQUIDATION"
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section: "701"
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citation: "11 U.S.C. § 701"
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---
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# 11 U.S.C. § 701 - Interim trustee
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## Text
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(a) (1) Promptly after the order for relief under this chapter, the United States trustee shall appoint one disinterested person that is a member of the panel of private trustees established under section 586(a)(1) of title 28 or that is serving as trustee in the case immediately before the order for relief under this chapter to serve as interim trustee in the case.
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(2) If none of the members of such panel is willing to serve as interim trustee in the case, then the United States trustee may serve as interim trustee in the case.
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(b) The service of an interim trustee under this section terminates when a trustee elected or designated under section 702 of this title to serve as trustee in the case qualifies under section 322 of this title.
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(c) An interim trustee serving under this section is a trustee in a case under this title.
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(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2604; Pub. L. 99–554, title II, § 215, Oct. 27, 1986, 100 Stat. 3100.)
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## Notes
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Historical and Revision Notes
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legislative statementsThe House amendment deletes section 701(d) of the Senate amendment. It is anticipated that the Rules of Bankruptcy Procedure will require the appointment of an interim trustee at the earliest practical moment in commodity broker bankruptcies, but no later than noon of the day after the date of the filing of the petition, due to the volatility of such cases.
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senate report no. 95–989This section requires the court to appoint an interim trustee. The appointment must be made from the panel of private trustees established and maintained by the Director of the Administrative Office under proposed 28 U.S.C. 604(e). Subsection (a) requires the appointment of an interim trustee to be made promptly after the order for relief, unless a trustee is already serving in the case, such as before a conversion from a reorganization to a liquidation case. Subsection (b) specifies that the appointment of an interim trustee expires when the permanent trustee is elected or designated under section 702. Subsection (c) makes clear that an interim trustee is a trustee in a case under the bankruptcy code. Subsection (d) provides that in a commodity broker case where speed is essential the interim trustee must be appointed by noon of the business day immediately following the order for relief.
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Editorial Notes
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Amendments1986—Subsec. (a). Pub. L. 99–554 designated existing provisions as par. (1), substituted “the United States trustee shall appoint” for “the court shall appoint”, “586(a)(1)” for “604(f)”, “that is serving” for “that was serving”, and added par. (2).
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Statutory Notes and Related Subsidiaries
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Effective Date of 1986 AmendmentEffective date and applicability of amendment by Pub. L. 99–554 dependent upon the judicial district involved, see section 302(d), (e) of Pub. L. 99–554, set out as a note under section 581 of Title 28, Judiciary and Judicial Procedure.
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---
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type: "LegalText"
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title: "11 U.S.C. § 702"
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description: "Election of trustee"
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title_number: 11
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chapter_number: "7"
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chapter_name: "LIQUIDATION"
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section: "702"
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citation: "11 U.S.C. § 702"
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confidence: "official"
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tags: ["legal", "us-code"]
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---
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# 11 U.S.C. § 702 - Election of trustee
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## Text
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(a) A creditor may vote for a candidate for trustee only if such creditor—
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(1) holds an allowable, undisputed, fixed, liquidated, unsecured claim of a kind entitled to distribution under section 726(a)(2), 726(a)(3), 726(a)(4), 752(a), 766(h), or 766(i) of this title;
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(2) does not have an interest materially adverse, other than an equity interest that is not substantial in relation to such creditor’s interest as a creditor, to the interest of creditors entitled to such distribution; and
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(3) is not an insider.
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(b) At the meeting of creditors held under section 341 of this title, creditors may elect one person to serve as trustee in the case if election of a trustee is requested by creditors that may vote under subsection (a) of this section, and that hold at least 20 percent in amount of the claims specified in subsection (a)(1) of this section that are held by creditors that may vote under subsection (a) of this section.
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(c) A candidate for trustee is elected trustee if—
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(1) creditors holding at least 20 percent in amount of the claims of a kind specified in subsection (a)(1) of this section that are held by creditors that may vote under subsection (a) of this section vote; and
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(2) such candidate receives the votes of creditors holding a majority in amount of claims specified in subsection (a)(1) of this section that are held by creditors that vote for a trustee.
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(d) If a trustee is not elected under this section, then the interim trustee shall serve as trustee in the case.
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(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2604; Pub. L. 97–222, § 7, July 27, 1982, 96 Stat. 237; Pub. L. 98–353, title III, § 472, July 10, 1984, 98 Stat. 380.)
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## Notes
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Historical and Revision Notes
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legislative statementsThe House amendment adopts section 702(a)(2) of the Senate amendment. An insubstantial equity interest does not disqualify a creditor from voting for a candidate for trustee.
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senate report no. 95–989Subsection (a) of this section specifies which creditors may vote for a trustee. Only a creditor that holds an allowable, undisputed, fixed, liquidated, unsecured claim that is not entitled to priority, that does not have an interest materially adverse to the interest of general unsecured creditors, and that is not an insider may vote for a trustee. The phrase “materially adverse” is currently used in the Rules of Bankruptcy Procedure, rule 207(d). The application of the standard requires a balancing of various factors, such as the nature of the adversity. A creditor with a very small equity position would not be excluded from voting solely because he holds a small equity in the debtor. The Rules of Bankruptcy Procedure also currently provide for temporary allowance of claims, and will continue to do so for the purposes of determining who is eligible to vote under this provision. Subsection (b) permits creditors at the meeting of creditors to elect one person to serve as trustee in the case. Creditors holding at least 20 percent in amount of the claims specified in the preceding paragraph must request election before creditors may elect a trustee. Subsection (c) specifies that a candidate for trustee is elected trustee if creditors holding at least 20 percent in amount of those claims actually vote, and if the candidate receives a majority in amount of votes actually cast. Subsection (d) specifies that if a trustee is not elected, then the interim trustee becomes the permanent trustee and serves in the case permanently.
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Editorial Notes
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Amendments1984—Subsec. (b). Pub. L. 98–353, § 472(a), inserted “held” after “meeting of creditors”. Subsec. (c)(1). Pub. L. 98–353, § 472(b)(1), inserted “of a kind” after “claims”. Subsec. (c)(2). Pub. L. 98–353, § 472(b)(2), substituted “for a trustee” for “for trustee”. Subsec. (d). Pub. L. 98–353, § 472(c), substituted “this section” for “subsection (c) of this section”. 1982—Subsec. (a)(1). Pub. L. 97–222 substituted “726(a)(4), 752(a), 766(h), or 766(i)” for “or 726(a)(4)”.
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Statutory Notes and Related Subsidiaries
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Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
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---
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type: "LegalText"
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title: "11 U.S.C. § 703"
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description: "Successor trustee"
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jurisdiction: "us"
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corpus: "united_states_code"
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kind: "code_section"
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title_number: 11
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title_name: "BANKRUPTCY"
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chapter_number: "7"
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chapter_name: "LIQUIDATION"
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section: "703"
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citation: "11 U.S.C. § 703"
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status: "current"
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confidence: "official"
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tags: ["legal", "us-code"]
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---
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# 11 U.S.C. § 703 - Successor trustee
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## Text
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(a) If a trustee dies or resigns during a case, fails to qualify under section 322 of this title, or is removed under section 324 of this title, creditors may elect, in the manner specified in section 702 of this title, a person to fill the vacancy in the office of trustee.
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(b) Pending election of a trustee under subsection (a) of this section, if necessary to preserve or prevent loss to the estate, the United States trustee may appoint an interim trustee in the manner specified in section 701(a).
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(c) If creditors do not elect a successor trustee under subsection (a) of this section or if a trustee is needed in a case reopened under section 350 of this title, then the United States trustee—
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(1) shall appoint one disinterested person that is a member of the panel of private trustees established under section 586(a)(1) of title 28 to serve as trustee in the case; or
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(2) may, if none of the disinterested members of such panel is willing to serve as trustee, serve as trustee in the case.
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(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2605; Pub. L. 98–353, title III, § 473, July 10, 1984, 98 Stat. 381; Pub. L. 99–554, title II, § 216, Oct. 27, 1986, 100 Stat. 3100.)
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## Notes
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Historical and Revision Notes
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senate report no. 95–989If the office of trustee becomes vacant during the case, this section makes provision for the selection of a successor trustee. The office might become vacant through death, resignation, removal, failure to qualify under section 322 by posting bond, or the reopening of a case. If it does, creditors may elect a successor in the same manner as they may elect a trustee under the previous section. Pending the election of a successor, the court may appoint an interim trustee in the usual manner if necessary to preserve or prevent loss to the estate. If creditors do not elect a successor, or if a trustee is needed in a reopened case, then the court appoints a disinterested member of the panel of private trustees to serve.
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Editorial Notes
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Amendments1986—Subsec. (b). Pub. L. 99–554 amended subsec. (b) generally, substituting “the United States trustee may appoint” for “the court may appoint” and “manner specified in section 701(a)” for “manner and subject to the provisions of section 701 of this title”. Subsec. (c). Pub. L. 99–554 amended subsec. (c) generally, substituting “this section or” for “this section, or”, “then the United States trustee” for “then the court”, designating part of existing provisions as par. (1), and, as so designated, substituting “586(a)(1)” for “604(f)”, “in the case; or” for “in the case.”, and adding par. (2). 1984—Subsec. (b). Pub. L. 98–353 substituted “and subject to the provisions of section 701 of this title” for “specified in section 701(a) of this title. Sections 701(b) and 701(c) of this title apply to such interim trustee”.
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Statutory Notes and Related Subsidiaries
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Effective Date of 1986 AmendmentEffective date and applicability of amendment by Pub. L. 99–554 dependent upon the judicial district involved, see section 302(d), (e) of Pub. L. 99–554, set out as a note under section 581 of Title 28, Judiciary and Judicial Procedure.
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Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
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---
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||||
type: "LegalText"
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||||
title: "11 U.S.C. § 704"
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description: "Duties of trustee"
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corpus: "united_states_code"
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kind: "code_section"
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||||
title_number: 11
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title_name: "BANKRUPTCY"
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chapter_number: "7"
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chapter_name: "LIQUIDATION"
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section: "704"
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citation: "11 U.S.C. § 704"
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status: "current"
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confidence: "official"
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tags: ["legal", "us-code"]
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||||
---
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# 11 U.S.C. § 704 - Duties of trustee
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## Text
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(a) The trustee shall—
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(1) collect and reduce to money the property of the estate for which such trustee serves, and close such estate as expeditiously as is compatible with the best interests of parties in interest;
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(2) be accountable for all property received;
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(3) ensure that the debtor shall perform his intention as specified in section 521(a)(2)(B) of this title;
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(4) investigate the financial affairs of the debtor;
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(5) if a purpose would be served, examine proofs of claims and object to the allowance of any claim that is improper;
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(6) if advisable, oppose the discharge of the debtor;
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(7) unless the court orders otherwise, furnish such information concerning the estate and the estate’s administration as is requested by a party in interest;
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(8) if the business of the debtor is authorized to be operated, file with the court, with the United States trustee, and with any governmental unit charged with responsibility for collection or determination of any tax arising out of such operation, periodic reports and summaries of the operation of such business, including a statement of receipts and disbursements, and such other information as the United States trustee or the court requires;
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(9) make a final report and file a final account of the administration of the estate with the court and with the United States trustee;
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(10) if with respect to the debtor there is a claim for a domestic support obligation, provide the applicable notice specified in subsection (c);
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(11) if, at the time of the commencement of the case, the debtor (or any entity designated by the debtor) served as the administrator (as defined in section 3 of the Employee Retirement Income Security Act of 1974) of an employee benefit plan, continue to perform the obligations required of the administrator; and
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(12) use all reasonable and best efforts to transfer patients from a health care business that is in the process of being closed to an appropriate health care business that—
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(A) is in the vicinity of the health care business that is closing;
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(B) provides the patient with services that are substantially similar to those provided by the health care business that is in the process of being closed; and
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(C) maintains a reasonable quality of care.
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(b) (1) With respect to a debtor who is an individual in a case under this chapter—
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(A) the United States trustee (or the bankruptcy administrator, if any) shall review all materials filed by the debtor and, not later than 10 days after the date of the first meeting of creditors, file with the court a statement as to whether the debtor’s case would be presumed to be an abuse under section 707(b); and
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(B) not later than 7 days after receiving a statement under subparagraph (A), the court shall provide a copy of the statement to all creditors.
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(2) The United States trustee (or bankruptcy administrator, if any) shall, not later than 30 days after the date of filing a statement under paragraph (1), either file a motion to dismiss or convert under section 707(b) or file a statement setting forth the reasons the United States trustee (or the bankruptcy administrator, if any) does not consider such a motion to be appropriate, if the United States trustee (or the bankruptcy administrator, if any) determines that the debtor’s case should be presumed to be an abuse under section 707(b) and the product of the debtor’s current monthly income, multiplied by 12 is not less than—
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(A) in the case of a debtor in a household of 1 person, the median family income of the applicable State for 1 earner; or
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(B) in the case of a debtor in a household of 2 or more individuals, the highest median family income of the applicable State for a family of the same number or fewer individuals.
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(c) (1) In a case described in subsection (a)(10) to which subsection (a)(10) applies, the trustee shall—
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(A) (i) provide written notice to the holder of the claim described in subsection (a)(10) of such claim and of the right of such holder to use the services of the State child support enforcement agency established under sections 464 and 466 of the Social Security Act for the State in which such holder resides, for assistance in collecting child support during and after the case under this title;
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(ii) include in the notice provided under clause (i) the address and telephone number of such State child support enforcement agency; and
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(iii) include in the notice provided under clause (i) an explanation of the rights of such holder to payment of such claim under this chapter;
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(B) (i) provide written notice to such State child support enforcement agency of such claim; and
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(ii) include in the notice provided under clause (i) the name, address, and telephone number of such holder; and
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(C) at such time as the debtor is granted a discharge under section 727, provide written notice to such holder and to such State child support enforcement agency of—
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(i) the granting of the discharge;
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(ii) the last recent known address of the debtor;
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(iii) the last recent known name and address of the debtor’s employer; and
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(iv) the name of each creditor that holds a claim that—
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(I) is not discharged under paragraph (2), (4), or (14A) of section 523(a); or
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(II) was reaffirmed by the debtor under section 524(c).
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(2) (A) The holder of a claim described in subsection (a)(10) or the State child support enforcement agency of the State in which such holder resides may request from a creditor described in paragraph (1)(C)(iv) the last known address of the debtor.
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(B) Notwithstanding any other provision of law, a creditor that makes a disclosure of a last known address of a debtor in connection with a request made under subparagraph (A) shall not be liable by reason of making such disclosure.
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(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2605; Pub. L. 98–353, title III, §§ 311(a), 474, July 10, 1984, 98 Stat. 355, 381; Pub. L. 99–554, title II, § 217, Oct. 27, 1986, 100 Stat. 3100; Pub. L. 109–8, title I, § 102(c), title II, § 219(a), title IV, § 446(b), title XI, § 1105(a), Apr. 20, 2005, 119 Stat. 32, 55, 118, 192; Pub. L. 111–16, § 2(7), May 7, 2009, 123 Stat. 1607; Pub. L. 111–327, § 2(a)(24), Dec. 22, 2010, 124 Stat. 3560.)
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## Notes
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Historical and Revision Notes
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|
||||
legislative statementsSection 704(8) of the Senate amendment is deleted in the House amendment. Trustees should give constructive notice of the commencement of the case in the manner specified under section 549(c) of title 11.
|
||||
|
||||
senate report no. 95–989The essential duties of the trustee are enumerated in this section. Others, or elaborations on these, may be prescribed by the Rules of Bankruptcy Procedure to the extent not inconsistent with those prescribed by this section. The duties are derived from section 47a of the Bankruptcy Act [section 75(a) of former title 11]. The trustee’s principal duty is to collect and reduce to money the property of the estate for which he serves, and to close up the estate as expeditiously as is compatible with the best interests of parties in interest. He must be accountable for all property received, and must investigate the financial affairs of the debtor. If a purpose would be served (such as if there are assets that will be distributed), the trustee is required to examine proofs of claims and object to the allowance of any claim that is improper. If advisable, the trustee must oppose the discharge of the debtor, which is for the benefit of general unsecured creditors whom the trustee represents. The trustee is responsible to furnish such information concerning the estate and its administration as is requested by a party in interest. If the business of the debtor is authorized to be operated, then the trustee is required to file with governmental units charged with the responsibility for collection or determination of any tax arising out of the operation of the business periodic reports and summaries of the operation, including a statement of receipts and disbursements, and such other information as the court requires. He is required to give constructive notice of the commencement of the case in the manner specified under section 342(b).
|
||||
|
||||
Editorial Notes
|
||||
|
||||
References in TextSection 3 of the Employee Retirement Income Security Act of 1974, referred to in subsec. (a)(11), is classified to section 1002 of Title 29, Labor. Sections 464 and 466 of the Social Security Act, referred to in subsec. (c)(1)(A)(i), are classified to sections 664 and 666, respectively, of Title 42, The Public Health and Welfare.
|
||||
|
||||
Amendments2010—Subsec. (a)(3). Pub. L. 111–327 substituted “521(a)(2)(B)” for “521(2)(B)”. 2009—Subsec. (b)(1)(B). Pub. L. 111–16 substituted “7 days” for “5 days”. 2005—Pub. L. 109–8, § 102(c)(1), designated existing provisions as subsec. (a). Subsec. (a)(10). Pub. L. 109–8, § 219(a)(1), added par. (10). Subsec. (a)(11). Pub. L. 109–8, § 446(b), added par. (11). Subsec. (a)(12). Pub. L. 109–8, § 1105(a), added par. (12). Subsec. (b). Pub. L. 109–8, § 102(c)(2), added subsec. (b). Subsec. (c). Pub. L. 109–8, § 219(a)(2), added subsec. (c). 1986—Par. (8). Pub. L. 99–554, § 217(1), inserted “, with the United States trustee,” after “with the court” and “the United States trustee or” after “information as”. Par. (9). Pub. L. 99–554, § 217(2), inserted “with the United States trustee” after “court”. 1984—Par. (1). Pub. L. 98–353, § 474, substituted “close such estate” for “close up such estate”. Pars. (3) to (9). Pub. L. 98–353, § 311(a), added par. (3) and redesignated former pars. (3) to (8) as (4) to (9), respectively.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 2009 AmendmentAmendment by Pub. L. 111–16 effective Dec. 1, 2009, see section 7 of Pub. L. 111–16, set out as a note under section 109 of this title.
|
||||
|
||||
Effective Date of 2005 AmendmentAmendment by Pub. L. 109–8 effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1986 AmendmentEffective date and applicability of amendment by Pub. L. 99–554 dependent upon the judicial district involved, see section 302(d), (e) of Pub. L. 99–554, set out as a note under section 581 of Title 28, Judiciary and Judicial Procedure.
|
||||
|
||||
Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
|
||||
@@ -0,0 +1,53 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 705"
|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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||||
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|
||||
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|
||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 705 - Creditors’ committee
|
||||
|
||||
## Text
|
||||
|
||||
(a) At the meeting under section 341(a) of this title, creditors that may vote for a trustee under section 702(a) of this title may elect a committee of not fewer than three, and not more than eleven, creditors, each of whom holds an allowable unsecured claim of a kind entitled to distribution under section 726(a)(2) of this title.
|
||||
|
||||
(b) A committee elected under subsection (a) of this section may consult with the trustee or the United States trustee in connection with the administration of the estate, make recommendations to the trustee or the United States trustee respecting the performance of the trustee’s duties, and submit to the court or the United States trustee any question affecting the administration of the estate.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2605; Pub. L. 99–554, title II, § 218, Oct. 27, 1986, 100 Stat. 3100.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
legislative statementsSection 705(a) of the House amendment adopts a provision contained in the Senate amendment that limits a committee of creditors to not more than 11; the House bill contained no maximum limitation.
|
||||
|
||||
senate report no. 95–989This section is derived from section 44b of the Bankruptcy Act [section 72(b) of former title 11] without substantial change. It permits election by general unsecured creditors of a committee of not fewer than 3 members and not more than 11 members to consult with the trustee in connection with the administration of the estate, to make recommendations to the trustee respecting the performance of his duties, and to submit to the court any question affecting the administration of the estate. There is no provision for compensation or reimbursement of its counsel.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments1986—Subsec. (b). Pub. L. 99–554 inserted “or the United States trustee” in three places.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 1986 AmendmentEffective date and applicability of amendment by Pub. L. 99–554 dependent upon the judicial district involved, see section 302(d), (e) of Pub. L. 99–554, set out as a note under section 581 of Title 28, Judiciary and Judicial Procedure.
|
||||
@@ -0,0 +1,61 @@
|
||||
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|
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|
||||
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|
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 706 - Conversion
|
||||
|
||||
## Text
|
||||
|
||||
(a) The debtor may convert a case under this chapter to a case under chapter 11, 12, or 13 of this title at any time, if the case has not been converted under section 1112, 1208, or 1307 of this title. Any waiver of the right to convert a case under this subsection is unenforceable.
|
||||
|
||||
(b) On request of a party in interest and after notice and a hearing, the court may convert a case under this chapter to a case under chapter 11 of this title at any time.
|
||||
|
||||
(c) The court may not convert a case under this chapter to a case under chapter 12 or 13 of this title unless the debtor requests or consents to such conversion.
|
||||
|
||||
(d) Notwithstanding any other provision of this section, a case may not be converted to a case under another chapter of this title unless the debtor may be a debtor under such chapter.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2606; Pub. L. 99–554, title II, § 257(q), Oct. 27, 1986, 100 Stat. 3115; Pub. L. 103–394, title V, § 501(d)(22), Oct. 22, 1994, 108 Stat. 4146; Pub. L. 109–8, title I, § 101, Apr. 20, 2005, 119 Stat. 27.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
legislative statementsSection 706(a) of the House amendment adopts a provision contained in the Senate amendment indicating that a waiver of the right to convert a case under section 706(a) is unenforceable. The explicit reference in title 11 forbidding the waiver of certain rights is not intended to imply that other rights, such as the right to file a voluntary bankruptcy case under section 301, may be waived. Section 706 of the House amendment adopts a similar provision contained in H.R. 8200 as passed by the House. Competing proposals contained in section 706(c) and section 706(d) of the Senate amendment are rejected.
|
||||
|
||||
senate report no. 95–989Subsection (a) of this section gives the debtor the one-time absolute right of conversion of a liquidation case to a reorganization or individual repayment plan case. If the case has already once been converted from chapter 11 or 13 to chapter 7, then the debtor does not have that right. The policy of the provision is that the debtor should always be given the opportunity to repay his debts, and a waiver of the right to convert a case is unenforceable. Subsection (b) permits the court, on request of a party in interest and after notice and a hearing, to convert the case to chapter 11 at any time. The decision whether to convert is left in the sound discretion of the court, based on what will most inure to the benefit of all parties in interest. Subsection (c) is part of the prohibition against involuntary chapter 13 cases, and prohibits the court from converting a case to chapter 13 without the debtor’s consent. Subsection (d) reinforces section 109 by prohibiting conversion to a chapter unless the debtor is eligible to be a debtor under that chapter.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments2005—Subsec. (c). Pub. L. 109–8 inserted “or consents to” after “requests”. 1994—Subsec. (a). Pub. L. 103–394 substituted “1208, or 1307” for “1307, or 1208”. 1986—Subsec. (a). Pub. L. 99–554, § 257(q)(1), inserted references to chapter 12 and section 1208 of this title. Subsec. (c). Pub. L. 99–554, § 257(q)(2), inserted reference to chapter 12.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 2005 AmendmentAmendment by Pub. L. 109–8 effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1994 AmendmentAmendment by Pub. L. 103–394 effective Oct. 22, 1994, and not applicable with respect to cases commenced under this title before Oct. 22, 1994, see section 702 of Pub. L. 103–394, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1986 AmendmentAmendment by Pub. L. 99–554 effective 30 days after Oct. 27, 1986, but not applicable to cases commenced under this title before that date, see section 302(a), (c)(1) of Pub. L. 99–554, set out as a note under section 581 of Title 28, Judiciary and Judicial Procedure.
|
||||
File diff suppressed because one or more lines are too long
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||||
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|
||||
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|
||||
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||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 721 - Authorization to operate business
|
||||
|
||||
## Text
|
||||
|
||||
The court may authorize the trustee to operate the business of the debtor for a limited period, if such operation is in the best interest of the estate and consistent with the orderly liquidation of the estate.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2606.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
senate report no. 95–989This section is derived from section 2a(5) of the Bankruptcy Act [section 11(a)(5) of former title 11]. It permits the court to authorize the operation of any business of the debtor for a limited period, if the operation is in the best interest of the estate and consistent with orderly liquidation of the estate. An example is the operation of a watch company to convert watch movements and cases into completed watches which will bring much higher prices than the component parts would have brought.
|
||||
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|
||||
---
|
||||
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|
||||
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|
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|
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|
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||||
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|
||||
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|
||||
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|
||||
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|
||||
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||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 722 - Redemption
|
||||
|
||||
## Text
|
||||
|
||||
An individual debtor may, whether or not the debtor has waived the right to redeem under this section, redeem tangible personal property intended primarily for personal, family, or household use, from a lien securing a dischargeable consumer debt, if such property is exempted under section 522 of this title or has been abandoned under section 554 of this title, by paying the holder of such lien the amount of the allowed secured claim of such holder that is secured by such lien in full at the time of redemption.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2606; Pub. L. 109–8, title III, § 304(2), Apr. 20, 2005, 119 Stat. 79.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
legislative statementsSection 722 of the House amendment adopts the position taken in H.R. 8200 as passed by the House and rejects the alternative contained in section 722 of the Senate amendment.
|
||||
|
||||
senate report no. 95–989This section is new and is broader than rights of redemption under the Uniform Commercial Code. It authorizes an individual debtor to redeem tangible personal property intended primarily for personal, family, or household use, from a lien securing a nonpurchase money dischargeable consumer debt. It applies only if the debtor’s interest in the property is exempt or has been abandoned. This right to redeem is a very substantial change from current law. To prevent abuses such as may occur when the debtor deliberately allows the property to depreciate in value, the debtor will be required to pay the fair market value of the goods or the amount of the claim if the claim is less. The right is personal to the debtor and not assignable.
|
||||
|
||||
house report no. 95–595This section is new and is broader than rights of redemption under the Uniform Commercial Code. It authorizes an individual debtor to redeem tangible personal property intended primarily for personal, family, or household use, from a lien securing a dischargeable consumer debt. It applies only if the debtor’s interest in the property is exempt or has been abandoned. The right to redeem extends to the whole of the property, not just the debtor’s exempt interest in it. Thus, for example, if a debtor owned a $2,000 car, subject to a $1,200 lien, the debtor could exempt his $800 interest in the car. The debtor is permitted a $1,500 exemption in a car, proposed 11 U.S.C. 522(d)(2). This section permits him to pay the holder of the lien $1,200 and redeem the entire car, not just the remaining $700 of his exemption. The redemption is accomplished by paying the holder of the lien the amount of the allowed claim secured by the lien. The provision amounts to a right of first refusal for the debtor in consumer goods that might otherwise be repossessed. The right of redemption under this section is not waivable.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments2005—Pub. L. 109–8 inserted “in full at the time of redemption” before period at end.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 2005 AmendmentAmendment by Pub. L. 109–8 effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of this title.
|
||||
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|
||||
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||||
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|
||||
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|
||||
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|
||||
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||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 723 - Rights of partnership trustee against general partners
|
||||
|
||||
## Text
|
||||
|
||||
(a) If there is a deficiency of property of the estate to pay in full all claims which are allowed in a case under this chapter concerning a partnership and with respect to which a general partner of the partnership is personally liable, the trustee shall have a claim against such general partner to the extent that under applicable nonbankruptcy law such general partner is personally liable for such deficiency.
|
||||
|
||||
(b) To the extent practicable, the trustee shall first seek recovery of such deficiency from any general partner in such partnership that is not a debtor in a case under this title. Pending determination of such deficiency, the court may order any such partner to provide the estate with indemnity for, or assurance of payment of, any deficiency recoverable from such partner, or not to dispose of property.
|
||||
|
||||
(c) The trustee has a claim against the estate of each general partner in such partnership that is a debtor in a case under this title for the full amount of all claims of creditors allowed in the case concerning such partnership. Notwithstanding section 502 of this title, there shall not be allowed in such partner’s case a claim against such partner on which both such partner and such partnership are liable, except to any extent that such claim is secured only by property of such partner and not by property of such partnership. The claim of the trustee under this subsection is entitled to distribution in such partner’s case under section 726(a) of this title the same as any other claim of a kind specified in such section.
|
||||
|
||||
(d) If the aggregate that the trustee recovers from the estates of general partners under subsection (c) of this section is greater than any deficiency not recovered under subsection (b) of this section, the court, after notice and a hearing, shall determine an equitable distribution of the surplus so recovered, and the trustee shall distribute such surplus to the estates of the general partners in such partnership according to such determination.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2606; Pub. L. 98–353, title III, § 476, July 10, 1984, 98 Stat. 381; Pub. L. 103–394, title II, § 212, Oct. 22, 1994, 108 Stat. 4125; Pub. L. 111–327, § 2(a)(26), Dec. 22, 2010, 124 Stat. 3560.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
legislative statementsSection 723(c) of the House amendment is a compromise between similar provisions contained in the House bill and Senate amendment. The section makes clear that the trustee of a partnership has a claim against each general partner for the full amount of all claims of creditors allowed in the case concerning the partnership. By restricting the trustee’s rights to claims of “creditors,” the trustee of the partnership will not have a claim against the general partners for administrative expenses or claims allowed in the case concerning the partnership. As under present law, sections of the Bankruptcy Act [former title 11] applying to codebtors and sureties apply to the relationship of a partner with respect to a partnership debtor. See sections 501(b), 502(e), 506(d)(2), 509, 524(d), and 1301 of title 11.
|
||||
|
||||
senate report no. 95–989This section is a significant departure from present law. It repeals the jingle rule, which, for ease of administration, denied partnership creditors their rights against general partners by permitting general partners’ individual creditors to share in their estates first to the exclusion of partnership creditors. The result under this section more closely tracks generally applicable partnership law, without a significant administrative burden. Subsection (a) specifies that each general partner in a partnership debtor is liable to the partnership’s trustee for any deficiency of partnership property to pay in full all administrative expenses and all claims against the partnership. Subsection (b) requires the trustee to seek recovery of the deficiency from any general partner that is not a debtor in a bankruptcy case. The court is empowered to order that partner to indemnify the estate or not to dispose of property pending a determination of the deficiency. The language of the subsection is directed to cases under the bankruptcy code. However, if, during the early stages of the transition period, a partner in a partnership is proceeding under the Bankruptcy Act [former title 11] while the partnership is proceeding under the bankruptcy code, the trustee should not first seek recovery against the Bankruptcy Act partner. Rather, the Bankruptcy Act partner should be deemed for the purposes of this section and the rights of the trustee to be proceeding under title 11. Subsection (c) requires the partnership trustee to seek recovery of the full amount of the deficiency from the estate of each general partner that is a debtor in a bankruptcy case. The trustee will share equally with the partners’ individual creditors in the assets of the partners’ estates. Claims of partnership creditors who may have filed against the partner will be disallowed to avoid double counting. Subsection (d) provides for the case where the total recovery from all of the bankrupt general partners is greater than the deficiency of which the trustee sought recovery. This case would most likely occur for a partnership with a large number of general partners. If the situation arises, the court is required to determine an equitable redistribution of the surplus to the estate of the general partners. The determination will be based on factors such as the relative liability of each of the general partners under the partnership agreement and the relative rights of each of the general partners in the profits of the enterprise under the partnership agreement.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments2010—Subsec. (c). Pub. L. 111–327 substituted “The trustee has” for “Notwithstanding section 728(c) of this title, the trustee has”. 1994—Subsec. (a). Pub. L. 103–394 substituted “to the extent that under applicable nonbankruptcy law such general partner is personally liable for such deficiency” for “for the full amount of the deficiency”. 1984—Subsec. (a). Pub. L. 98–353, § 476, substituted provisions that the trustee shall have a claim for the full amount of the deficiency against a general partner who is personally liable with respect to claims concerning partnerships which are allowed in a case under this chapter, for provisions that each general partner in the partnership would be liable to the trustee for the full amount of such deficiency. Subsec. (c). Pub. L. 98–353, § 476(b), substituted “such partner’s case” for “such case” in two places, “by property of such partnership” for “be property of such partnership”, and “a kind specified in such section” for “the kind specified in such section”.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 1994 AmendmentAmendment by Pub. L. 103–394 effective Oct. 22, 1994, and not applicable with respect to cases commenced under this title before Oct. 22, 1994, see section 702 of Pub. L. 103–394, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
|
||||
@@ -0,0 +1,91 @@
|
||||
---
|
||||
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|
||||
title: "11 U.S.C. § 724"
|
||||
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|
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|
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|
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
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|
||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 724 - Treatment of certain liens
|
||||
|
||||
## Text
|
||||
|
||||
(a) The trustee may avoid a lien that secures a claim of a kind specified in section 726(a)(4) of this title.
|
||||
|
||||
(b) Property in which the estate has an interest and that is subject to a lien that is not avoidable under this title (other than to the extent that there is a properly perfected unavoidable tax lien arising in connection with an ad valorem tax on real or personal property of the estate) and that secures an allowed claim for a tax, or proceeds of such property, shall be distributed—
|
||||
|
||||
(1) first, to any holder of an allowed claim secured by a lien on such property that is not avoidable under this title and that is senior to such tax lien;
|
||||
|
||||
(2) second, to any holder of a claim of a kind specified in section 507(a)(1)(C) or 507(a)(2) (except that such expenses under each such section, other than claims for wages, salaries, or commissions that arise after the date of the filing of the petition, shall be limited to expenses incurred under this chapter and shall not include expenses incurred under chapter 11 of this title), 507(a)(1)(A), 507(a)(1)(B), 507(a)(3), 507(a)(4), 507(a)(5), 507(a)(6), or 507(a)(7) of this title, to the extent of the amount of such allowed tax claim that is secured by such tax lien;
|
||||
|
||||
(3) third, to the holder of such tax lien, to any extent that such holder’s allowed tax claim that is secured by such tax lien exceeds any amount distributed under paragraph (2) of this subsection;
|
||||
|
||||
(4) fourth, to any holder of an allowed claim secured by a lien on such property that is not avoidable under this title and that is junior to such tax lien;
|
||||
|
||||
(5) fifth, to the holder of such tax lien, to the extent that such holder’s allowed claim secured by such tax lien is not paid under paragraph (3) of this subsection; and
|
||||
|
||||
(6) sixth, to the estate.
|
||||
|
||||
(c) If more than one holder of a claim is entitled to distribution under a particular paragraph of subsection (b) of this section, distribution to such holders under such paragraph shall be in the same order as distribution to such holders would have been other than under this section.
|
||||
|
||||
(d) A statutory lien the priority of which is determined in the same manner as the priority of a tax lien under section 6323 of the Internal Revenue Code of 1986 shall be treated under subsection (b) of this section the same as if such lien were a tax lien.
|
||||
|
||||
(e) Before subordinating a tax lien on real or personal property of the estate, the trustee shall—
|
||||
|
||||
(1) exhaust the unencumbered assets of the estate; and
|
||||
|
||||
(2) in a manner consistent with section 506(c), recover from property securing an allowed secured claim the reasonable, necessary costs and expenses of preserving or disposing of such property.
|
||||
|
||||
(f) Notwithstanding the exclusion of ad valorem tax liens under this section and subject to the requirements of subsection (e), the following may be paid from property of the estate which secures a tax lien, or the proceeds of such property:
|
||||
|
||||
(1) Claims for wages, salaries, and commissions that are entitled to priority under section 507(a)(4).
|
||||
|
||||
(2) Claims for contributions to an employee benefit plan entitled to priority under section 507(a)(5).
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2607; Pub. L. 98–353, title III, § 477, July 10, 1984, 98 Stat. 381; Pub. L. 99–554, title II, § 283(r), Oct. 27, 1986, 100 Stat. 3118; Pub. L. 103–394, title III, § 304(h)(4), title V, § 501(d)(23), Oct. 22, 1994, 108 Stat. 4134, 4146; Pub. L. 109–8, title VII, § 701(a), Apr. 20, 2005, 119 Stat. 124; Pub. L. 111–327, § 2(a)(27), Dec. 22, 2010, 124 Stat. 3560.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
legislative statementsSection 724 of the House amendment adopts the provision taken in the House bill and rejects the provision taken in the Senate amendment. In effect, a tax claim secured by a lien is treated as a claim between the fifth and sixth priority in a case under chapter 7 rather than as a secured claim. Treatment of certain liens: The House amendment modifies present law by requiring the subordination of tax liens on both real and personal property to the payment of claims having a priority. This means that assets are to be distributed from the debtor’s estate to pay higher priority claims before the tax claims are paid, even though the tax claims are properly secured. Under present law and the Senate amendment only tax liens on personal property, but not on real property, are subordinated to the payment of claims having a priority above the priority for tax claims.
|
||||
|
||||
senate report no. 95–989Subsection (a) of section 724 permits the trustee to avoid a lien that secures a fine, penalty, forfeiture, or multiple, punitive, or exemplary damages claim to the extent that the claim is not compensation for actual pecuniary loss. The subsection follows the policy found in section 57j of the Bankruptcy Act [section 93(j) of former title 11] of protecting unsecured creditors from the debtor’s wrongdoing, but expands the protection afforded. The lien is made voidable rather than void in chapter 7, in order to permit the lien to be revived if the case is converted to chapter 11 under which penalty liens are not voidable. To make the lien void would be to permit the filing of a chapter 7, the voiding of the lien, and the conversion to a chapter 11, simply to avoid a penalty lien, which should be valid in a reorganization case. Subsection (b) governs tax liens. This provision retains the rule of present bankruptcy law (§ 67(C)(3) of the Bankruptcy Act [section 107(c)(3) of former title 11]) that a tax lien on personal property, if not avoidable by the trustee, is subordinated in payment to unsecured claims having a higher priority than unsecured tax claims. Those other claims may be satisfied from the amount that would otherwise have been applied to the tax lien, and any excess of the amount of the lien is then applied to the tax. Any personal property (or sale proceeds) remaining is to be used to satisfy claims secured by liens which are junior to the tax lien. Any proceeds remaining are next applied to pay any unpaid balance of the tax lien. Subsection (d) specifies that any statutory lien whose priority is determined in the same manner as a tax lien is to be treated as a tax lien under this section, even if the lien does not secure a claim for taxes. An example is the ERISA [29 U.S.C. 1001 et seq.] lien.
|
||||
|
||||
house report no. 95–595Subsection (b) governs tax liens. It is derived from section 67c(3) of the Bankruptcy Act [section 107(c)(3) of former title 11], without substantial modification in result. It subordinates tax liens to administrative expense and wage claims, and solves certain circuity of liens problems that arise in connection with the subordination. The order of distribution of property subject to a tax lien is as follows: First, to holders of liens senior to the tax lien; second, to administrative expenses, wage claims, and consumer creditors that are granted priority, but only to the extent of the amount of the allowed tax claim secured by the lien. In other words, the priority claimants step into the shoes of the tax collector. Third, to the tax claimant, to the extent that priority claimants did not use up his entire claim. Fourth, to junior lien holders. Fifth, to the tax collector to the extent that he was not paid under paragraph (3). Finally, any remaining property goes to the estate. The result of these provisions are to leave senior and junior lienors and holders of unsecured claims undisturbed. If there are any liens that are equal in status to the tax lien, they share pari passu with the tax lien under the distribution provisions of this subsection.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
References in TextSection 6323 of the Internal Revenue Code of 1986, referred to in subsec. (d), is classified to section 6323 of Title 26, Internal Revenue Code.
|
||||
|
||||
Amendments2010—Subsec. (b)(2). Pub. L. 111–327 substituted “507(a)(1)(C) or 507(a)(2)” for “507(a)(1)”, “this chapter” for “chapter 7 of this title”, and “507(a)(1)(A), 507(a)(1)(B),” for “507(a)(2),” and inserted “under each such section” after “such expenses”. 2005—Subsec. (b). Pub. L. 109–8, § 701(a)(1), inserted “(other than to the extent that there is a properly perfected unavoidable tax lien arising in connection with an ad valorem tax on real or personal property of the estate)” after “under this title” in introductory provisions. Subsec. (b)(2). Pub. L. 109–8, § 701(a)(2), inserted “(except that such expenses, other than claims for wages, salaries, or commissions that arise after the date of the filing of the petition, shall be limited to expenses incurred under chapter 7 of this title and shall not include expenses incurred under chapter 11 of this title)” after “section 507(a)(1)”. Subsecs. (e), (f). Pub. L. 109–8, § 701(a)(3), added subsecs. (e) and (f). 1994—Subsec. (b)(2). Pub. L. 103–394, § 304(h)(4), substituted “507(a)(6), or 507(a)(7)” for “or 507(a)(6)”. Subsec. (d). Pub. L. 103–394, § 501(d)(23), substituted “Internal Revenue Code of 1986” for “Internal Revenue Code of 1954 (26 U.S.C. 6323)”. 1986—Subsec. (b)(2). Pub. L. 99–554 inserted reference to section 507(a)(6) of this title. 1984—Subsec. (b). Pub. L. 98–353, § 477(a)(1), substituted “a tax” for “taxes” in provisions preceding par. (1). Subsec. (b)(2). Pub. L. 98–353, § 477(a)(2), substituted “any holder of a claim of a kind specified” for “claims specified”, “section 507(a)(1)” for “sections 507(a)(1)”, and “or 507(a)(5) of this title” for “and 507(a)(5) of this title”. Subsec. (b)(3). Pub. L. 98–353, § 477(a)(3), substituted “allowed tax claim” for “allowed claim”. Subsec. (c). Pub. L. 98–353, § 477(b), substituted “holder of a claim is entitled” for “creditor is entitled” and “holders” for “creditors” in two places. Subsec. (d). Pub. L. 98–353, § 477(c), substituted “the priority of which” for “whose priority” and “the same as if such lien were a tax lien” for “the same as a tax lien”.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 2005 AmendmentAmendment by Pub. L. 109–8 effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1994 AmendmentAmendment by Pub. L. 103–394 effective Oct. 22, 1994, and not applicable with respect to cases commenced under this title before Oct. 22, 1994, see section 702 of Pub. L. 103–394, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1986 AmendmentAmendment by Pub. L. 99–554 effective 30 days after Oct. 27, 1986, see section 302(a) of Pub. L. 99–554, set out as a note under section 581 of Title 28, Judiciary and Judicial Procedure.
|
||||
|
||||
Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
|
||||
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|
||||
---
|
||||
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|
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||||
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|
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 725 - Disposition of certain property
|
||||
|
||||
## Text
|
||||
|
||||
After the commencement of a case under this chapter, but before final distribution of property of the estate under section 726 of this title, the trustee, after notice and a hearing, shall dispose of any property in which an entity other than the estate has an interest, such as a lien, and that has not been disposed of under another section of this title.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2607; Pub. L. 98–353, title III, § 478, July 10, 1984, 98 Stat. 381.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
legislative statementsSection 725 of the House amendment adopts the substance contained in both the House bill and Senate amendment but transfers an administrative function to the trustee in accordance with the general thrust of this legislation to separate the administrative and the judicial functions where appropriate.
|
||||
|
||||
senate report no. 95–989This section requires the court to determine the appropriate disposition of property in which the estate and an entity other than the estate have an interest. It would apply, for example, to property subject to a lien or property co-owned by the estate and another entity. The court must make the determination with respect to property that is not disposed of under another section of the bankruptcy code, such as by abandonment under section 554, by sale or distribution under 363, or by allowing foreclosure by a secured creditor by lifting the stay under section 362. The purpose of the section is to give the court appropriate authority to ensure that collateral or its proceeds is returned to the proper secured creditor, that consigned or bailed goods are returned to the consignor or bailor and so on. Current law is curiously silent on this point, though case law has grown to fill the void. The section is in lieu of a section that would direct a certain distribution to secured creditors. It gives the court greater flexibility to meet the circumstances, and it is broader, permitting disposition of property subject to a co-ownership interest.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments1984—Pub. L. 98–353 substituted “distribution of property of the estate” for “distribution”.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
|
||||
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|
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|
||||
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|
||||
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|
||||
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|
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---
|
||||
|
||||
# 11 U.S.C. § 726 - Distribution of property of the estate
|
||||
|
||||
## Text
|
||||
|
||||
(a) Except as provided in section 510 of this title, property of the estate shall be distributed—
|
||||
|
||||
(1) first, in payment of claims of the kind specified in, and in the order specified in, section 507 of this title, proof of which is timely filed under section 501 of this title or tardily filed on or before the earlier of—
|
||||
|
||||
(A) the date that is 10 days after the mailing to creditors of the summary of the trustee’s final report; or
|
||||
|
||||
(B) the date on which the trustee commences final distribution under this section;
|
||||
|
||||
(2) second, in payment of any allowed unsecured claim, other than a claim of a kind specified in paragraph (1), (3), or (4) of this subsection, proof of which is—
|
||||
|
||||
(A) timely filed under section 501(a) of this title;
|
||||
|
||||
(B) timely filed under section 501(b) or 501(c) of this title; or
|
||||
|
||||
(C) tardily filed under section 501(a) of this title, if—
|
||||
|
||||
(i) the creditor that holds such claim did not have notice or actual knowledge of the case in time for timely filing of a proof of such claim under section 501(a) of this title; and
|
||||
|
||||
(ii) proof of such claim is filed in time to permit payment of such claim;
|
||||
|
||||
(3) third, in payment of any allowed unsecured claim proof of which is tardily filed under section 501(a) of this title, other than a claim of the kind specified in paragraph (2)(C) of this subsection;
|
||||
|
||||
(4) fourth, in payment of any allowed claim, whether secured or unsecured, for any fine, penalty, or forfeiture, or for multiple, exemplary, or punitive damages, arising before the earlier of the order for relief or the appointment of a trustee, to the extent that such fine, penalty, forfeiture, or damages are not compensation for actual pecuniary loss suffered by the holder of such claim;
|
||||
|
||||
(5) fifth, in payment of interest at the legal rate from the date of the filing of the petition, on any claim paid under paragraph (1), (2), (3), or (4) of this subsection; and
|
||||
|
||||
(6) sixth, to the debtor.
|
||||
|
||||
(b) Payment on claims of a kind specified in paragraph (1), (2), (3), (4), (5), (6), (7), (8), (9), or (10) of section 507(a) of this title, or in paragraph (2), (3), (4), or (5) of subsection (a) of this section, shall be made pro rata among claims of the kind specified in each such particular paragraph, except that in a case that has been converted to this chapter under section 1112, 1208, or 1307 of this title, a claim allowed under section 503(b) of this title incurred under this chapter after such conversion has priority over a claim allowed under section 503(b) of this title incurred under any other chapter of this title or under this chapter before such conversion and over any expenses of a custodian superseded under section 543 of this title.
|
||||
|
||||
(c) Notwithstanding subsections (a) and (b) of this section, if there is property of the kind specified in section 541(a)(2) of this title, or proceeds of such property, in the estate, such property or proceeds shall be segregated from other property of the estate, and such property or proceeds and other property of the estate shall be distributed as follows:
|
||||
|
||||
(1) Claims allowed under section 503 of this title shall be paid either from property of the kind specified in section 541(a)(2) of this title, or from other property of the estate, as the interest of justice requires.
|
||||
|
||||
(2) Allowed claims, other than claims allowed under section 503 of this title, shall be paid in the order specified in subsection (a) of this section, and, with respect to claims of a kind specified in a particular paragraph of section 507 of this title or subsection (a) of this section, in the following order and manner:
|
||||
|
||||
(A) First, community claims against the debtor or the debtor’s spouse shall be paid from property of the kind specified in section 541(a)(2) of this title, except to the extent that such property is solely liable for debts of the debtor.
|
||||
|
||||
(B) Second, to the extent that community claims against the debtor are not paid under subparagraph (A) of this paragraph, such community claims shall be paid from property of the kind specified in section 541(a)(2) of this title that is solely liable for debts of the debtor.
|
||||
|
||||
(C) Third, to the extent that all claims against the debtor including community claims against the debtor are not paid under subparagraph (A) or (B) of this paragraph such claims shall be paid from property of the estate other than property of the kind specified in section 541(a)(2) of this title.
|
||||
|
||||
(D) Fourth, to the extent that community claims against the debtor or the debtor’s spouse are not paid under subparagraph (A), (B), or (C) of this paragraph, such claims shall be paid from all remaining property of the estate.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2608; Pub. L. 98–353, title III, § 479, July 10, 1984, 98 Stat. 381; Pub. L. 99–554, title II, §§ 257(r), 283(s), Oct. 27, 1986, 100 Stat. 3115, 3118; Pub. L. 103–394, title II, § 213(b), title III, § 304(h)(5), title V, § 501(d)(24), Oct. 22, 1994, 108 Stat. 4126, 4134, 4146; Pub. L. 109–8, title VII, § 713, title XII, § 1215, Apr. 20, 2005, 119 Stat. 128, 195; Pub. L. 111–327, § 2(a)(28), Dec. 22, 2010, 124 Stat. 3560.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
legislative statementsSection 726(a)(4) adopts a provision contained in the Senate amendment subordinating prepetition penalties and penalties arising in the involuntary gap period to the extent the penalties are not compensation for actual pecuniary laws. The House amendment deletes a provision following section 726(a)(6) of the Senate amendment providing that the term “claim” includes interest due owed before the date of the filing of the petition as unnecessary since a right to payment for interest due is a right to payment which is within the definition of “claim” in section 101(4) of the House amendment.
|
||||
|
||||
senate report no. 95–989This section is the general distribution section for liquidation cases. It dictates the order in which distribution of property of the estate, which has usually been reduced to money by the trustee under the requirements of section 704(1). First, property is distributed among priority claimants, as determined by section 507, and in the order prescribed by section 507. Second, distribution is to general unsecured creditors. This class excludes priority creditors and the two classes of subordinated creditors specified below. The provision is written to permit distribution to creditors that tardily file claims if their tardiness was due to lack of notice or knowledge of the case. Though it is in the interest of the estate to encourage timely filing, when tardy filing is not the result of a failure to act by the creditor, the normal subordination penalty should not apply. Third distribution is to general unsecured creditors who tardily file. Fourth distribution is to holders of fine, penalty, forfeiture, or multiple, punitive, or exemplary damage claims. More of these claims are disallowed entirely under present law. They are simply subordinated here. Paragraph (4) provides that punitive penalties, including prepetition tax penalties, are subordinated to the payment of all other classes of claims, except claims for interest accruing during the case. In effect, these penalties are payable out of the estate’s assets only if and to the extent that a surplus of assets would otherwise remain at the close of the case for distribution back to the debtor. Paragraph (5) provides that postpetition interest on prepetition claims is also to be paid to the creditor in a subordinated position. Like prepetition penalties, such interest will be paid from the estate only if and to the extent that a surplus of assets would otherwise remain for return to the debtor at the close of the case. This section also specifies that interest accrued on all claims (including priority and nonpriority tax claims) which accrued before the date of the filing of the title 11 petition is to be paid in the same order of distribution of the estate’s assets as the principal amount of the related claims. Any surplus is paid to the debtor under paragraph (6). Subsection (b) follows current law. It specifies that claims within a particular class are to be paid pro rata. This provision will apply, of course, only when there are inadequate funds to pay the holders of claims of a particular class in full. The exception found in the section, which also follows current law, specifies that liquidation administrative expenses are to be paid ahead of reorganization administrative expenses if the case has been converted from a reorganization case to a liquidation case, or from an individual repayment plan case to a liquidation case. Subsection (c) governs distributions in cases in which there is community property and other property of the estate. The section requires the two kinds of property to be segregated. The distribution is as follows: First, administrative expenses are to be paid, as the court determines on any reasonable equitable basis, from both kinds of property. The court will divide administrative expenses according to such factors as the amount of each kind of property in the estate, the cost of preservation and liquidation of each kind of property, and whether any particular administrative expenses are attributable to one kind of property or the other. Second, claims are to be paid as provided under subsection (a) (the normal liquidation case distribution rules) in the following order and manner: First, community claims against the debtor or the debtor’s spouse are paid from community property, except such as is liable solely for the debts of the debtor. Second, community claims against the debtor, to the extent not paid under the first provision, are paid from community property that is solely liable for the debts of the debtor. Third, community claims, to the extent they remain unpaid, and all other claims against the debtor, are paid from noncommunity property. Fourth, if any community claims against the debtor or the debtor’s spouse remain unpaid, they are paid from whatever property remains in the estate. This would occur if community claims against the debtor’s spouse are large in amount and most of the estate’s property is property solely liable, under nonbankruptcy law, for debts of the debtor. The marshalling rules in this section apply only to property of the estate. However, they will provide a guide to the courts in the interpretation of proposed 11 U.S.C. 725, relating to distribution of collateral, in cases in which there is community property. If a secured creditor has a lien on both community and noncommunity property, the marshalling rules here—by analogy would dictate that the creditor be satisfied first out of community property, and then out of separate property.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments2010—Subsec. (b). Pub. L. 111–327 substituted “(8), (9), or (10)” for “or (8)”. 2005—Subsec. (a)(1). Pub. L. 109–8, § 713, substituted “on or before the earlier of—” and subpars. (A) and (B) for “before the date on which the trustee commences distribution under this section;”. Subsec. (b). Pub. L. 109–8, § 1215, struck out “1009,” before “1112”. 1994—Subsec. (a)(1). Pub. L. 103–394, § 213(b), inserted before semicolon at end “, proof of which is timely filed under section 501 of this title or tardily filed before the date on which the trustee commences distribution under this section”. Subsec. (b). Pub. L. 103–394, §§ 304(h)(5), 501(d)(24), substituted “, (7), or (8)” for “or (7)” and “chapter under section 1009, 1112,” for “chapter under section 1112”. 1986—Subsec. (b). Pub. L. 99–554, § 283(s), inserted reference to par. (7) of section 507(a) of this title. Pub. L. 99–554, § 257(r), inserted reference to section 1208 of this title. 1984—Subsec. (b). Pub. L. 98–353, § 479(a), substituted “each such particular paragraph” for “a particular paragraph”, “a claim allowed under section 503(b) of this title” for “administrative expenses” in two places, and “has priority over” for “have priority over”. Subsec. (c)(1). Pub. L. 98–353, § 479(b)(1), substituted “Claims allowed under section 503 of this title” for “Administrative expenses”. Subsec. (c)(2). Pub. L. 98–353, § 479(b)(2), substituted “Allowed claims, other than claims allowed under section 503 of this title,” for “Claims other than for administrative expenses”.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 2005 AmendmentAmendment by Pub. L. 109–8 effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1994 AmendmentAmendment by Pub. L. 103–394 effective Oct. 22, 1994, and not applicable with respect to cases commenced under this title before Oct. 22, 1994, see section 702 of Pub. L. 103–394, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1986 AmendmentAmendment by section 257 of Pub. L. 99–554 effective 30 days after Oct. 27, 1986, but not applicable to cases commenced under this title before that date, see section 302(a), (c)(1) of Pub. L. 99–554, set out as a note under section 581 of Title 28, Judiciary and Judicial Procedure. Amendment by section 283 of Pub. L. 99–554 effective 30 days after Oct. 27, 1986, see section 302(a) of Pub. L. 99–554.
|
||||
|
||||
Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
|
||||
@@ -0,0 +1,139 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 727"
|
||||
description: "Discharge"
|
||||
jurisdiction: "us"
|
||||
corpus: "united_states_code"
|
||||
kind: "code_section"
|
||||
title_number: 11
|
||||
title_name: "BANKRUPTCY"
|
||||
chapter_number: "7"
|
||||
chapter_name: "LIQUIDATION"
|
||||
section: "727"
|
||||
citation: "11 U.S.C. § 727"
|
||||
status: "current"
|
||||
release_point: "119-100"
|
||||
release_date: "2026-06-26"
|
||||
source: "official"
|
||||
source_url: "https://uscode.house.gov/download/releasepoints/us/pl/119/100/xml_usc11@119-100.zip"
|
||||
source_identifier: "/us/usc/t11/s727"
|
||||
source_file: "data/legal/raw/us/code/title-11/usc11.xml"
|
||||
source_hash: "ccd6e69e9da2edaf9f1f25c24bc90e580d022b87b48081993fa05e45742c4c77"
|
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raw_snapshot_hash: "49b32bf784de01de21874d64b5d1d78d1d245352824a03caa6d6b941a4a2c9a2"
|
||||
text_hash: "634f59160a2de98f267e520a9ceb0645724af8e2a1543c687d9a5dc9dbe34007"
|
||||
retrieved_at: "2026-07-04"
|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 727 - Discharge
|
||||
|
||||
## Text
|
||||
|
||||
(a) The court shall grant the debtor a discharge, unless—
|
||||
|
||||
(1) the debtor is not an individual;
|
||||
|
||||
(2) the debtor, with intent to hinder, delay, or defraud a creditor or an officer of the estate charged with custody of property under this title, has transferred, removed, destroyed, mutilated, or concealed, or has permitted to be transferred, removed, destroyed, mutilated, or concealed—
|
||||
|
||||
(A) property of the debtor, within one year before the date of the filing of the petition; or
|
||||
|
||||
(B) property of the estate, after the date of the filing of the petition;
|
||||
|
||||
(3) the debtor has concealed, destroyed, mutilated, falsified, or failed to keep or preserve any recorded information, including books, documents, records, and papers, from which the debtor’s financial condition or business transactions might be ascertained, unless such act or failure to act was justified under all of the circumstances of the case;
|
||||
|
||||
(4) the debtor knowingly and fraudulently, in or in connection with the case—
|
||||
|
||||
(A) made a false oath or account;
|
||||
|
||||
(B) presented or used a false claim;
|
||||
|
||||
(C) gave, offered, received, or attempted to obtain money, property, or advantage, or a promise of money, property, or advantage, for acting or forbearing to act; or
|
||||
|
||||
(D) withheld from an officer of the estate entitled to possession under this title, any recorded information, including books, documents, records, and papers, relating to the debtor’s property or financial affairs;
|
||||
|
||||
(5) the debtor has failed to explain satisfactorily, before determination of denial of discharge under this paragraph, any loss of assets or deficiency of assets to meet the debtor’s liabilities;
|
||||
|
||||
(6) the debtor has refused, in the case—
|
||||
|
||||
(A) to obey any lawful order of the court, other than an order to respond to a material question or to testify;
|
||||
|
||||
(B) on the ground of privilege against self-incrimination, to respond to a material question approved by the court or to testify, after the debtor has been granted immunity with respect to the matter concerning which such privilege was invoked; or
|
||||
|
||||
(C) on a ground other than the properly invoked privilege against self-incrimination, to respond to a material question approved by the court or to testify;
|
||||
|
||||
(7) the debtor has committed any act specified in paragraph (2), (3), (4), (5), or (6) of this subsection, on or within one year before the date of the filing of the petition, or during the case, in connection with another case, under this title or under the Bankruptcy Act, concerning an insider;
|
||||
|
||||
(8) the debtor has been granted a discharge under this section, under section 1141 of this title, or under section 14, 371, or 476 of the Bankruptcy Act, in a case commenced within 8 years before the date of the filing of the petition;
|
||||
|
||||
(9) the debtor has been granted a discharge under section 1228 or 1328 of this title, or under section 660 or 661 of the Bankruptcy Act, in a case commenced within six years before the date of the filing of the petition, unless payments under the plan in such case totaled at least—
|
||||
|
||||
(A) 100 percent of the allowed unsecured claims in such case; or
|
||||
|
||||
(B) (i) 70 percent of such claims; and
|
||||
|
||||
(ii) the plan was proposed by the debtor in good faith, and was the debtor’s best effort;
|
||||
|
||||
(10) the court approves a written waiver of discharge executed by the debtor after the order for relief under this chapter;
|
||||
|
||||
(11) after filing the petition, the debtor failed to complete an instructional course concerning personal financial management described in section 111, except that this paragraph shall not apply with respect to a debtor who is a person described in section 109(h)(4) or who resides in a district for which the United States trustee (or the bankruptcy administrator, if any) determines that the approved instructional courses are not adequate to service the additional individuals who would otherwise be required to complete such instructional courses under this section (The United States trustee (or the bankruptcy administrator, if any) who makes a determination described in this paragraph shall review such determination not later than 1 year after the date of such determination, and not less frequently than annually thereafter.); or
|
||||
|
||||
(12) the court after notice and a hearing held not more than 10 days before the date of the entry of the order granting the discharge finds that there is reasonable cause to believe that—
|
||||
|
||||
(A) section 522(q)(1) may be applicable to the debtor; and
|
||||
|
||||
(B) there is pending any proceeding in which the debtor may be found guilty of a felony of the kind described in section 522(q)(1)(A) or liable for a debt of the kind described in section 522(q)(1)(B).
|
||||
|
||||
(b) Except as provided in section 523 of this title, a discharge under subsection (a) of this section discharges the debtor from all debts that arose before the date of the order for relief under this chapter, and any liability on a claim that is determined under section 502 of this title as if such claim had arisen before the commencement of the case, whether or not a proof of claim based on any such debt or liability is filed under section 501 of this title, and whether or not a claim based on any such debt or liability is allowed under section 502 of this title.
|
||||
|
||||
(c) (1) The trustee, a creditor, or the United States trustee may object to the granting of a discharge under subsection (a) of this section.
|
||||
|
||||
(2) On request of a party in interest, the court may order the trustee to examine the acts and conduct of the debtor to determine whether a ground exists for denial of discharge.
|
||||
|
||||
(d) On request of the trustee, a creditor, or the United States trustee, and after notice and a hearing, the court shall revoke a discharge granted under subsection (a) of this section if—
|
||||
|
||||
(1) such discharge was obtained through the fraud of the debtor, and the requesting party did not know of such fraud until after the granting of such discharge;
|
||||
|
||||
(2) the debtor acquired property that is property of the estate, or became entitled to acquire property that would be property of the estate, and knowingly and fraudulently failed to report the acquisition of or entitlement to such property, or to deliver or surrender such property to the trustee;
|
||||
|
||||
(3) the debtor committed an act specified in subsection (a)(6) of this section; or
|
||||
|
||||
(4) the debtor has failed to explain satisfactorily—
|
||||
|
||||
(A) a material misstatement in an audit referred to in section 586(f) of title 28; or
|
||||
|
||||
(B) a failure to make available for inspection all necessary accounts, papers, documents, financial records, files, and all other papers, things, or property belonging to the debtor that are requested for an audit referred to in section 586(f) of title 28.
|
||||
|
||||
(e) The trustee, a creditor, or the United States trustee may request a revocation of a discharge—
|
||||
|
||||
(1) under subsection (d)(1) of this section within one year after such discharge is granted; or
|
||||
|
||||
(2) under subsection (d)(2) or (d)(3) of this section before the later of—
|
||||
|
||||
(A) one year after the granting of such discharge; and
|
||||
|
||||
(B) the date the case is closed.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2609; Pub. L. 98–353, title III, § 480, July 10, 1984, 98 Stat. 382; Pub. L. 99–554, title II, §§ 220, 257(s), Oct. 27, 1986, 100 Stat. 3101, 3116; Pub. L. 109–8, title I, § 106(b), title III, §§ 312(1), 330(a), title VI, § 603(d), Apr. 20, 2005, 119 Stat. 38, 86, 101, 123.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
legislative statementsSections 727(a) (8) and (9) of the House amendment represent a compromise between provisions contained in section 727(a)(8) of the House bill and Senate amendment. Section 727(a)(8) of the House amendment adopts section 727(a)(8) of the House bill. However, section 727(a)(9) of the House amendment contains a compromise based on section 727(a)(8) of the Senate amendment with respect to the circumstances under which a plan by way of composition under Chapter XIII of the Bankruptcy Act [chapter 13 of former title 11] should be a bar to discharge in a subsequent proceeding under title 11. The paragraph provides that a discharge under section 660 or 661 of the Bankruptcy Act [section 1060 or 1061 of former title 11] or section 1328 of title 11 in a case commenced within 6 years before the date of the filing of the petition in a subsequent case, operates as a bar to discharge unless, first, payments under the plan totaled at least 100 percent of the allowed unsecured claims in the case; or second, payments under the plan totaled at least 70 percent of the allowed unsecured claims in the case and the plan was proposed by the debtor in good faith and was the debtor’s best effort. It is expected that the Rules of Bankruptcy Procedure will contain a provision permitting the debtor to request a determination of whether a plan is the debtor’s “best effort” prior to confirmation of a plan in a case under chapter 13 of title 11. In determining whether a plan is the debtor’s “best effort” the court will evaluate several factors. Different facts and circumstances in cases under chapter 13 operate to make any rule of thumb of limited usefulness. The court should balance the debtor’s assets, including family income, health insurance, retirement benefits, and other wealth, a sum which is generally determinable, against the foreseeable necessary living expenses of the debtor and the debtor’s dependents, which unfortunately is rarely quantifiable. In determining the expenses of the debtor and the debtor’s dependents, the court should consider the stability of the debtor’s employment, if any, the age of the debtor, the number of the debtor’s dependents and their ages, the condition of equipment and tools necessary to the debtor’s employment or to the operation of his business, and other foreseeable expenses that the debtor will be required to pay during the period of the plan, other than payments to be made to creditors under the plan. Section 727(a)(10) of the House amendment clarifies a provision contained in section 727(a)(9) of the House bill and Senate amendment indicating that a discharge may be barred if the court approves a waiver of discharge executed in writing by the debtor after the order for relief under chapter 7. Section 727(b) of the House amendment adopts a similar provision contained in the Senate amendment modifying the effect of discharge. The provision makes clear that the debtor is discharged from all debts that arose before the date of the order for relief under chapter 7 in addition to any debt which is determined under section 502 as if it were a prepetition claim. Thus, if a case is converted from chapter 11 or chapter 13 to a case under chapter 7, all debts prior to the time of conversion are discharged, in addition to debts determined after the date of conversion of a kind specified in section 502, that are to be determined as prepetition claims. This modification is particularly important with respect to an individual debtor who files a petition under chapter 11 or chapter 13 of title 11 if the case is converted to chapter 7. The logical result of the House amendment is to equate the result that obtains whether the case is converted from another chapter to chapter 7, or whether the other chapter proceeding is dismissed and a new case is commenced by filing a petition under chapter 7.
|
||||
|
||||
senate report no. 95–989This section is the heart of the fresh start provisions of the bankruptcy law. Subsection (a) requires the court to grant a debtor a discharge unless one of nine conditions is met. The first condition is that the debtor is not an individual. This is a change from present law, under which corporations and partnerships may be discharged in liquidation cases, though they rarely are. The change in policy will avoid trafficking in corporate shells and in bankrupt partnerships. “Individual” includes a deceased individual, so that if the debtor dies during the bankruptcy case, he will nevertheless be released from his debts, and his estate will not be liable for them. Creditors will be entitled to only one satisfaction—from the bankruptcy estate and not from the probate estate. The next three grounds for denial of discharge center on the debtor’s wrongdoing in or in connection with the bankruptcy case. They are derived from Bankruptcy Act § 14c [section 32(c) of former title 11]. If the debtor, with intent to hinder, delay, or defraud his creditors or an officer of the estate, has transferred, removed, destroyed, mutilated, or concealed, or has permitted any such action with respect to, property of the debtor within the year preceding the case, or property of the estate after the commencement of the case, then the debtor is denied discharge. The debtor is also denied discharge if he has concealed, destroyed, mutilated, falsified, or failed to keep or preserve any books and records from which his financial condition might be ascertained, unless the act or failure to act was justified under all the circumstances of the case. The fourth ground for denial of discharge is the commission of a bankruptcy crime, although the standard of proof is preponderance of the evidence rather than proof beyond a reasonable doubt. These crimes include the making of a false oath or account, the use or presentation of a false claim, the giving or receiving of money for acting or forbearing to act, and the withholding from an officer of the estate entitled to possession of books and records relating to the debtor’s financial affairs. The fifth ground for denial of discharge is the failure of the debtor to explain satisfactorily any loss of assets or deficiency of assets to meet the debtor’s liabilities. The sixth ground concerns refusal to testify. It is a change from present law, under which the debtor may be denied discharge for legitimately exercising his right against self-incrimination. Under this provision, the debtor may be denied discharge if he refuses to obey any lawful order of the court, or if he refuses to testify after having been granted immunity or after improperly invoking the constitutional privilege against self-incrimination. The seventh ground for denial of discharge is the commission of an act specified in grounds two through six during the year before the debtor’s case in connection with another bankruptcy case concerning an insider. The eighth ground for denial of discharge is derived from § 14c(5) of the Bankruptcy Act [section 32(c)(5) of former title 11]. If the debtor has been granted a discharge in a case commenced within 6 years preceding the present bankruptcy case, he is denied discharge. This provision, which is no change from current law with respect to straight bankruptcy, is the 6-year bar to discharge. Discharge under chapter 11 will bar a discharge for 6 years. As under current law, confirmation of a composition wage earner plan under chapter 13 is a basis for invoking the 6-year bar. The ninth ground is approval by the court of a waiver of discharge. Subsection (b) specifies that the discharge granted under this section discharges the debtor from all debts that arose before the date of the order for relief. It is irrelevant whether or not a proof of claim was filed with respect to the debt, and whether or not the claim based on the debt was allowed. Subsection (c) permits the trustee, or a creditor, to object to discharge. It also permits the court, on request of a party in interest, to order the trustee to examine the acts and conduct of the debtor to determine whether a ground for denial of discharge exists. Subsection (d) requires the court to revoke a discharge already granted in certain circumstances. If the debtor obtained the discharge through fraud, if he acquired and concealed property of the estate, or if he refused to obey a court order or to testify, the discharge is to be revoked. Subsection (e) permits the trustee or a creditor to request revocation of a discharge within 1 year after the discharge is granted, on the grounds of fraud, and within one year of discharge or the date of the closing of the case, whichever is later, on other grounds.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
References in TextThe Bankruptcy Act, referred to in subsec. (a)(7), is act July 1, 1898, ch. 541, 30 Stat. 544, which was classified generally to former Title 11. Sections 14, 371, and 476 of the Bankruptcy Act, referred to in subsec. (a)(8), are section 14 of act July 1, 1898, ch. 541, 30 Stat. 550, section 371 of act July 1, 1898, ch. 541, as added June 22, 1938, ch. 575, § 1, 52 Stat. 912, and section 476 of act July 1, 1898, ch. 541, as added June 22, 1938, ch. 575, § 1, 52 Stat. 924, which were classified to sections 32, 771, and 876 of former Title 11. Sections 660 and 661 of the Bankruptcy Act, referred to in subsec. (a)(9), are sections 660 and 661 of act July 1, 1898, ch. 541, as added June 22, 1938, ch. 575, § 1, 52 Stat. 935, 936, which were classified to sections 1060 and 1061 of former Title 11.
|
||||
|
||||
Amendments2005—Subsec. (a)(8). Pub. L. 109–8, § 312(1), substituted “8 years” for “six years”. Subsec. (a)(11). Pub. L. 109–8, § 106(b), added par. (11). Subsec. (a)(12). Pub. L. 109–8, § 330(a), added par. (12). Subsec. (d)(4). Pub. L. 109–8, § 603(d), added par. (4). 1986—Subsec. (a)(9). Pub. L. 99–554, § 257(s), inserted reference to section 1228 of this title. Subsec. (c). Pub. L. 99–554, § 220, amended subsec. (c) generally, substituting “The trustee, a creditor, or the United States trustee may object” for “The trustee or a creditor may object” in par. (1). Subsec. (d). Pub. L. 99–554, § 220, amended subsec. (d) generally, substituting “, a creditor, or the United States trustee,” for “or a creditor,” in provisions preceding par. (1) and “acquisition of or entitlement to such property” for “acquisition of, or entitlement to, such property” in par. (2). Subsec. (e). Pub. L. 99–554, § 220, amended subsec. (e) generally, substituting “The trustee, a creditor, or the United States trustee may” for “The trustee or a creditor may” in provisions preceding par. (1), “section within” for “section, within” and “discharge is granted” for “discharge was granted” in par. (1), “section before” for “section, before” in provisions of par. (2) preceding subpar. (A), and “discharge; and” for “discharge; or” in par. (2)(A). 1984—Subsec. (a)(6)(C). Pub. L. 98–353, § 480(a)(1), substituted “properly” for “property”. Subsec. (a)(7). Pub. L. 98–353, § 480(a)(2), inserted “, under this title or under the Bankruptcy Act,” after “another case”. Subsec. (a)(8). Pub. L. 98–353, § 480(a)(3), substituted “371,” for “371”. Subsec. (c)(1). Pub. L. 98–353, § 480(b), substituted “to the granting of a discharge” for “to discharge”. Subsec. (e)(2)(A). Pub. L. 98–353, § 480(c), substituted “or” for “and”.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 2005 AmendmentAmendment by section 603(d) of Pub. L. 109–8 effective 18 months after Apr. 20, 2005, see section 603(e) of Pub. L. 109–8, set out as a note under section 521 of this title. Amendments by sections 106(b), 312(1), and 330(a) of Pub. L. 109–8 effective 180 days after Apr. 20, 2005, with amendments by sections 106(b) and 312(1) of Pub. L. 109–8 not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, and amendment by section 330(a) of Pub. L. 109–8 applicable with respect to cases commenced under this title on or after Apr. 20, 2005, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1986 AmendmentAmendment by section 257 of Pub. L. 99–554 effective 30 days after Oct. 27, 1986, but not applicable to cases commenced under this title before that date, see section 302(a), (c)(1) of Pub. L. 99–554, set out as a note under section 581 of Title 28, Judiciary and Judicial Procedure. Effective date and applicability of amendment by section 220 of Pub. L. 99–554 dependent upon the judicial district involved, see section 302(d), (e) of Pub. L. 99–554.
|
||||
|
||||
Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
|
||||
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|
||||
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|
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|
||||
title: "11 U.S.C. § 728"
|
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||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 728 - Repealed. Pub. L. 109–8, title VII, § 719(b)(1), Apr. 20, 2005, 119 Stat. 133]
|
||||
|
||||
## Notes
|
||||
|
||||
Section, Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2611; Pub. L. 98–353, title III, § 481, July 10, 1984, 98 Stat. 382; Pub. L. 99–554, title II, § 257(t), Oct. 27, 1986, 100 Stat. 3116, related to special tax provisions.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of RepealRepeal effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as an Effective Date of 2005 Amendment note under section 101 of this title.
|
||||
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|
||||
---
|
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|
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||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 741 - Definitions for this subchapter
|
||||
|
||||
## Text
|
||||
|
||||
In this subchapter—
|
||||
|
||||
(1) “Commission” means Securities and Exchange Commission;
|
||||
|
||||
(2) “customer” includes—
|
||||
|
||||
(A) entity with whom a person deals as principal or agent and that has a claim against such person on account of a security received, acquired, or held by such person in the ordinary course of such person’s business as a stockbroker, from or for the securities account or accounts of such entity—
|
||||
|
||||
(i) for safekeeping;
|
||||
|
||||
(ii) with a view to sale;
|
||||
|
||||
(iii) to cover a consummated sale;
|
||||
|
||||
(iv) pursuant to a purchase;
|
||||
|
||||
(v) as collateral under a security agreement; or
|
||||
|
||||
(vi) for the purpose of effecting registration of transfer; and
|
||||
|
||||
(B) entity that has a claim against a person arising out of—
|
||||
|
||||
(i) a sale or conversion of a security received, acquired, or held as specified in subparagraph (A) of this paragraph; or
|
||||
|
||||
(ii) a deposit of cash, a security, or other property with such person for the purpose of purchasing or selling a security;
|
||||
|
||||
(3) “customer name security” means security—
|
||||
|
||||
(A) held for the account of a customer on the date of the filing of the petition by or on behalf of the debtor;
|
||||
|
||||
(B) registered in such customer’s name on such date or in the process of being so registered under instructions from the debtor; and
|
||||
|
||||
(C) not in a form transferable by delivery on such date;
|
||||
|
||||
(4) “customer property” means cash, security, or other property, and proceeds of such cash, security, or property, received, acquired, or held by or for the account of the debtor, from or for the securities account of a customer—
|
||||
|
||||
(A) including—
|
||||
|
||||
(i) property that was unlawfully converted from and that is the lawful property of the estate;
|
||||
|
||||
(ii) a security held as property of the debtor to the extent such security is necessary to meet a net equity claim of a customer based on a security of the same class and series of an issuer;
|
||||
|
||||
(iii) resources provided through the use or realization of a customer’s debit cash balance or a debit item includible in the Formula for Determination of Reserve Requirement for Brokers and Dealers as promulgated by the Commission under the Securities Exchange Act of 1934; and
|
||||
|
||||
(iv) other property of the debtor that any applicable law, rule, or regulation requires to be set aside or held for the benefit of a customer, unless including such property as customer property would not significantly increase customer property; but
|
||||
|
||||
(B) not including—
|
||||
|
||||
(i) a customer name security delivered to or reclaimed by a customer under section 751 of this title; or
|
||||
|
||||
(ii) property to the extent that a customer does not have a claim against the debtor based on such property;
|
||||
|
||||
(5) “margin payment” means payment or deposit of cash, a security, or other property, that is commonly known to the securities trade as original margin, initial margin, maintenance margin, or variation margin, or as a mark-to-market payment, or that secures an obligation of a participant in a securities clearing agency;
|
||||
|
||||
(6) “net equity” means, with respect to all accounts of a customer that such customer has in the same capacity—
|
||||
|
||||
(A) (i) aggregate dollar balance that would remain in such accounts after the liquidation, by sale or purchase, at the time of the filing of the petition, of all securities positions in all such accounts, except any customer name securities of such customer; minus
|
||||
|
||||
(ii) any claim of the debtor against such customer in such capacity that would have been owing immediately after such liquidation; plus
|
||||
|
||||
(B) any payment by such customer to the trustee, within 60 days after notice under section 342 of this title, of any business related claim of the debtor against such customer in such capacity;
|
||||
|
||||
(7) “securities contract”—
|
||||
|
||||
(A) means—
|
||||
|
||||
(i) a contract for the purchase, sale, or loan of a security, a certificate of deposit, a mortgage loan, any interest in a mortgage loan, a group or index of securities, certificates of deposit, or mortgage loans or interests therein (including an interest therein or based on the value thereof), or option on any of the foregoing, including an option to purchase or sell any such security, certificate of deposit, mortgage loan, interest, group or index, or option, and including any repurchase or reverse repurchase transaction on any such security, certificate of deposit, mortgage loan, interest, group or index, or option (whether or not such repurchase or reverse repurchase transaction is a “repurchase agreement”, as defined in section 101);
|
||||
|
||||
(ii) any option entered into on a national securities exchange relating to foreign currencies;
|
||||
|
||||
(iii) the guarantee (including by novation) by or to any securities clearing agency of a settlement of cash, securities, certificates of deposit, mortgage loans or interests therein, group or index of securities, or mortgage loans or interests therein (including any interest therein or based on the value thereof), or option on any of the foregoing, including an option to purchase or sell any such security, certificate of deposit, mortgage loan, interest, group or index, or option (whether or not such settlement is in connection with any agreement or transaction referred to in clauses (i) through (xi));
|
||||
|
||||
(iv) any margin loan;
|
||||
|
||||
(v) any extension of credit for the clearance or settlement of securities transactions;
|
||||
|
||||
(vi) any loan transaction coupled with a securities collar transaction, any prepaid forward securities transaction, or any total return swap transaction coupled with a securities sale transaction;
|
||||
|
||||
(vii) any other agreement or transaction that is similar to an agreement or transaction referred to in this subparagraph;
|
||||
|
||||
(viii) any combination of the agreements or transactions referred to in this subparagraph;
|
||||
|
||||
(ix) any option to enter into any agreement or transaction referred to in this subparagraph;
|
||||
|
||||
(x) a master agreement that provides for an agreement or transaction referred to in clause (i), (ii), (iii), (iv), (v), (vi), (vii), (viii), or (ix), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a securities contract under this subparagraph, except that such master agreement shall be considered to be a securities contract under this subparagraph only with respect to each agreement or transaction under such master agreement that is referred to in clause (i), (ii), (iii), (iv), (v), (vi), (vii), (viii), or (ix); or
|
||||
|
||||
(xi) any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in this subparagraph, including any guarantee or reimbursement obligation by or to a stockbroker, securities clearing agency, financial institution, or financial participant in connection with any agreement or transaction referred to in this subparagraph, but not to exceed the damages in connection with any such agreement or transaction, measured in accordance with section 562; and
|
||||
|
||||
(B) does not include any purchase, sale, or repurchase obligation under a participation in a commercial mortgage loan;
|
||||
|
||||
(8) “settlement payment” means a preliminary settlement payment, a partial settlement payment, an interim settlement payment, a settlement payment on account, a final settlement payment, or any other similar payment commonly used in the securities trade; and
|
||||
|
||||
(9) “SIPC” means Securities Investor Protection Corporation.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2611; Pub. L. 97–222, § 8, July 27, 1982, 96 Stat. 237; Pub. L. 98–353, title III, § 482, July 10, 1984, 98 Stat. 382; Pub. L. 103–394, title V, § 501(d)(25), Oct. 22, 1994, 108 Stat. 4146; Pub. L. 109–8, title IX, § 907(a)(2), Apr. 20, 2005, 119 Stat. 173; Pub. L. 109–390, § 5(a)(3), Dec. 12, 2006, 120 Stat. 2697.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
legislative statementsSection 741(6) of the House bill and Senate amendment is deleted by the House amendment since the defined term is used only in section 741(4)(A)(iii). A corresponding change is made in that section.
|
||||
|
||||
senate report no. 95–989Section 741 sets forth definitions for subchapter III of chapter 7. Paragraph (1) defines “Commission” to mean the Securities and Exchange Commission. Paragraph (2) defines “customer” to include anybody that interacts with the debtor in a capacity that concerns securities transactions. The term embraces cash or margin customers of a broker or dealer in the broadest sense. Paragraph (3) defines “customer name security” in a restrictive fashion to include only non-transferable securities that are registered, or in the process of being registered in a customer’s own name. The securities must not be endorsed by the customer and the stockbroker must not be able to legally transfer the securities by delivery, by a power of attorney, or otherwise. Paragraph (4) defines “customer property” to include all property of the debtor that has been segregated for customers or property that should have been segregated but was unlawfully converted. Clause (i) refers to customer property not properly segregated by the debtor or customer property converted and then recovered so as to become property of the estate. Unlawfully converted property that has been transferred to a third party is excluded until it is recovered as property of the estate by virtue of the avoiding powers. The concept excludes customer name securities that have been delivered to or reclaimed by a customer and any property properly belonging to the stockholder, such as money deposited by a customer to pay for securities that the stockholder has distributed to such customer. Paragraph (5) [enacted as (6)] defines “net equity” to establish the extent to which a customer will be entitled to share in the single and separate fund. Accounts of a customer are aggregated and offset only to the extent the accounts are held by the customer in the same capacity. Thus, a personal account is separate from an account held as trustee. In a community property state an account held for the community is distinct from an account held as separate property. The net equity is computed by liquidating all securities positions in the accounts and crediting the account with any amount due to the customer. Regardless of the actual dates, if any, of liquidation, the customer is only entitled to the liquidation value at the time of the filing of the petition. To avoid double counting, the liquidation value of customer name securities belonging to a customer is excluded from net equity. Thus, clause (ii) includes claims against a customer resulting from the liquidation of a security under clause (i). The value of a security on which trading has been suspended at the time of the filing of the petition will be estimated. Once the net liquidation value is computed, any amount that the customer owes to the stockbroker is subtracted including any amount that would be owing after the hypothetical liquidation, such as brokerage fees. Debts owed by the customer to the debtor, other than in a securities related transaction, will not reduce the net equity of the customer. Finally, net equity is increased by any payment by the customer to the debtor actually paid within 60 days after notice. The principal reason a customer would make such a payment is to reclaim customer name securities under § 751. Paragraph (6) defines “1934 Act” to mean the Securities Exchange Act of 1934 [15 U.S.C. 78a et seq.]. Paragraph (7) [enacted as (9)] defines “SIPC” to mean the Securities Investor Protection Corporation.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
References in TextThe Securities Exchange Act of 1934, referred to in par. (4)(A)(iii), is act June 6, 1934, ch. 404, 48 Stat. 881, which is classified principally to chapter 2B (§ 78a et seq.) of Title 15, Commerce and Trade. For complete classification of this Act to the Code, see section 78a of Title 15 and Tables.
|
||||
|
||||
Amendments2006—Par. (7)(A)(i). Pub. L. 109–390, § 5(a)(3)(A), substituted “a mortgage loan,” for “a mortgage loan or” and inserted “(whether or not such repurchase or reverse repurchase transaction is a ‘repurchase agreement’, as defined in section 101)” before semicolon at end. Par. (7)(A)(iii). Pub. L. 109–390, § 5(a)(3)(B), inserted “(including by novation)” after “the guarantee” and “(whether or not such settlement is in connection with any agreement or transaction referred to in clauses (i) through (xi))” before semicolon at end. Par. (7)(A)(v) to (vii). Pub. L. 109–390, § 5(a)(3)(D), (E), added cls. (v) and (vi) and redesignated former cl. (v) as (vii). Former cls. (vi) and (vii) redesignated (viii) and (ix), respectively. Par. (7)(A)(viii). Pub. L. 109–390, § 5(a)(3)(D), redesignated cl. (vi) as (viii). Former cl. (viii) redesignated (x). Pub. L. 109–390, § 5(a)(3)(C), substituted “(vii), (viii), or (ix)” for “or (vii)” in two places. Par. (7)(A)(ix) to (xi). Pub. L. 109–390, § 5(a)(3)(D), redesignated cls. (vii) to (ix) as (ix) to (xi), respectively. 2005—Par. (7). Pub. L. 109–8 added par. (7) and struck out former par. (7) which read as follows: “ ‘securities contract’ means contract for the purchase, sale, or loan of a security, including an option for the purchase or sale of a security, certificate of deposit, or group or index of securities (including any interest therein or based on the value thereof), or any option entered into on a national securities exchange relating to foreign currencies, or the guarantee of any settlement of cash or securities by or to a securities clearing agency;”. 1994—Par. (4)(A)(iii). Pub. L. 103–394 struck out “(15 U.S.C. 78a et seq.)” after “Act of 1934”. 1984—Par. (2)(A). Pub. L. 98–353, § 482(1), substituted “with whom a person deals” for “with whom the debtor deals”, “that has a claim” for “that holds a claim”, “against such person” for “against the debtor”, “held by such person” for “held by the debtor”, and “such person’s business as a stockbroker,” for “business as a stockbroker”. Par. (2)(B). Pub. L. 98–353, § 482(2)(A), (B), substituted “has a claim” for “holds a claim” and “against a person” for “against the debtor” in provisions preceding cl. (i). Par. (2)(B)(ii). Pub. L. 98–353, § 482(2)(C), substituted “such person” for “the debtor”. Par. (4)(A)(i). Pub. L. 98–353, § 482(3), substituted “from and that is the lawful” for “and that is”. Par. (6)(A)(i). Pub. L. 98–353, § 482(4), inserted a comma after “petition” and “any” after “except”. Par. (7). Pub. L. 98–353, § 482(5), amended par. (7) generally, inserting provisions relating to options for the purchase or sale of certificates of deposit, or a group or index of securities (including any interest therein or based on the value thereof), or any option entered into on a national securities exchange relating to foreign currencies. Par. (8). Pub. L. 98–353, § 482(6), inserted “a final settlement payment,”. 1982—Par. (4). Pub. L. 97–222, § 8(1), struck out “at any time” after “security, or property,” in provisions preceding subpar. (A), and inserted “of a customer” after “claim” in subpar. (A)(ii). Par. (5). Pub. L. 97–222, § 8(3), added par. (5). Former par. (5) redesignated (6). Par. (6). Pub. L. 97–222, § 8(2), (4), redesignated former par. (5) as (6), in provisions preceding subpar. (A), substituted “all accounts of a customer that such customer has” for “the aggregate of all of a customer’s accounts that such customer holds”, in subpar. (A)(2) inserted “in such capacity”, and in subpar. (B) inserted “in such capacity”. Former par. (6) redesignated (9). Pars. (7), (8). Pub. L. 97–222, § 8(5), added pars. (7) and (8). Par. (9). Pub. L. 97–222, § 8(2), (6), redesignated former par. (6) as (9) and substituted “Securities” for “Security”.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 2006 AmendmentAmendment by Pub. L. 109–390 not applicable to any cases commenced under this title or to appointments made under any Federal or State law, before Dec. 12, 2006, see section 7 of Pub. L. 109–390, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 2005 AmendmentAmendment by Pub. L. 109–8 effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1994 AmendmentAmendment by Pub. L. 103–394 effective Oct. 22, 1994, and not applicable with respect to cases commenced under this title before Oct. 22, 1994, see section 702 of Pub. L. 103–394, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
|
||||
@@ -0,0 +1,53 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 742"
|
||||
description: "Effect of section 362 of this title in this subchapter"
|
||||
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|
||||
corpus: "united_states_code"
|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
section: "742"
|
||||
citation: "11 U.S.C. § 742"
|
||||
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|
||||
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|
||||
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|
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|
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||||
text_hash: "f03d7ee479fc339e7bd92c4b7a8a40e636b818dc133bb62c10726d40d8553f7b"
|
||||
retrieved_at: "2026-07-04"
|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 742 - Effect of section 362 of this title in this subchapter
|
||||
|
||||
## Text
|
||||
|
||||
Notwithstanding section 362 of this title, SIPC may file an application for a protective decree under the Securities Investor Protection Act of 1970. The filing of such application stays all proceedings in the case under this title unless and until such application is dismissed. If SIPC completes the liquidation of the debtor, then the court shall dismiss the case.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2613; Pub. L. 97–222, § 9, July 27, 1982, 96 Stat. 237; Pub. L. 103–394, title V, § 501(d)(26), Oct. 22, 1994, 108 Stat. 4146.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
legislative statementsSection 742 of the House amendment deletes a sentence contained in the Senate amendment requiring the trustee in an interstate stock-brokerage liquidation to comply with the provisions of subchapter IV of chapter 7 if the debtor is also a commodity broker. The House amendment expands the requirement to require the SIPC trustee to perform such duties, if the debtor is a commodity broker, under section 7(b) of the Securities Investor Protection Act [15 U.S.C. 78ggg(b)]. The requirement is deleted from section 742 since the trustee of an intrastate stockbroker will be bound by the provisions of subchapter IV of chapter 7 if the debtor is also a commodity broker by reason of section 103 of title 11.
|
||||
|
||||
senate report no. 95–989Section 742 indicates that the automatic stay does not prevent SIPC from filing an application for a protective decree under SIPA. If SIPA does file such an application, then all bankruptcy proceedings are suspended until the SIPC action is completed. If SIPC completes liquidation of the stockbroker then the bankruptcy case is dismissed.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
References in TextThe Securities Investor Protection Act of 1970, referred to in text, is Pub. L. 91–598, Dec. 30, 1970, 84 Stat. 1636, which is classified generally to chapter 2B–1 (§ 78aaa et seq.) of Title 15, Commerce and Trade. For complete classification of this Act to the Code, see section 78aaa of Title 15 and Tables.
|
||||
|
||||
Amendments1994—Pub. L. 103–394 struck out “(15 U.S.C. 78aaa et seq.)” after “Act of 1970”. 1982—Pub. L. 97–222 substituted “title” for “chapter” after “all proceedings in the case under this”.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 1994 AmendmentAmendment by Pub. L. 103–394 effective Oct. 22, 1994, and not applicable with respect to cases commenced under this title before Oct. 22, 1994, see section 702 of Pub. L. 103–394, set out as a note under section 101 of this title.
|
||||
@@ -0,0 +1,51 @@
|
||||
---
|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
section: "743"
|
||||
citation: "11 U.S.C. § 743"
|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 743 - Notice
|
||||
|
||||
## Text
|
||||
|
||||
The clerk shall give the notice required by section 342 of this title to SIPC and to the Commission.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2613; Pub. L. 99–554, title II, § 283(t), Oct. 27, 1986, 100 Stat. 3118; Pub. L. 103–394, title V, § 501(d)(27), Oct. 22, 1994, 108 Stat. 4146.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
senate report no. 95–989Section 743 requires that notice of the order for relief be given to SIPC and to the SEC in every stockbroker case.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments1994—Pub. L. 103–394 substituted “342” for “342(a)”. 1986—Pub. L. 99–554, which directed the amendment of this section by striking “(d)”, rather than “(a)”, could not be executed because “(d)” did not appear in text. See 1994 Amendment note above.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 1994 AmendmentAmendment by Pub. L. 103–394 effective Oct. 22, 1994, and not applicable with respect to cases commenced under this title before Oct. 22, 1994, see section 702 of Pub. L. 103–394, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1986 AmendmentAmendment by Pub. L. 99–554 effective 30 days after Oct. 27, 1986, see section 302(a) of Pub. L. 99–554, set out as a note under section 581 of Title 28, Judiciary and Judicial Procedure.
|
||||
@@ -0,0 +1,45 @@
|
||||
---
|
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||||
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|
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|
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|
||||
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|
||||
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|
||||
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|
||||
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||||
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|
||||
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|
||||
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|
||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 744 - Executory contracts
|
||||
|
||||
## Text
|
||||
|
||||
Notwithstanding section 365(d)(1) of this title, the trustee shall assume or reject, under section 365 of this title, any executory contract of the debtor for the purchase or sale of a security in the ordinary course of the debtor’s business, within a reasonable time after the date of the order for relief, but not to exceed 30 days. If the trustee does not assume such a contract within such time, such contract is rejected.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2613; Pub. L. 97–222, § 10, July 27, 1982, 96 Stat. 238.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
senate report no. 95–989Section 744 instructs the court to give the trustee a reasonable time, not to exceed 30 days, to assume or reject any executory contract of the stockbroker to buy or sell securities. Any contract not assumed within the time fixed by the court is considered to be rejected.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments1982—Pub. L. 97–222 inserted “but” after “relief,”.
|
||||
@@ -0,0 +1,57 @@
|
||||
---
|
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|
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|
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|
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 745 - Treatment of accounts
|
||||
|
||||
## Text
|
||||
|
||||
(a) Accounts held by the debtor for a particular customer in separate capacities shall be treated as accounts of separate customers.
|
||||
|
||||
(b) If a stockbroker or a bank holds a customer net equity claim against the debtor that arose out of a transaction for a customer of such stockbroker or bank, each such customer of such stockbroker or bank shall be treated as a separate customer of the debtor.
|
||||
|
||||
(c) Each trustee’s account specified as such on the debtor’s books, and supported by a trust deed filed with, and qualified as such by, the Internal Revenue Service, and under the Internal Revenue Code of 1986, shall be treated as a separate customer account for each beneficiary under such trustee account.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2613; Pub. L. 97–222, § 11, July 27, 1982, 96 Stat. 238; Pub. L. 98–353, title III, § 483, July 10, 1984, 98 Stat. 383; Pub. L. 103–394, title V, § 501(d)(28), Oct. 22, 1994, 108 Stat. 4146.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
senate report no. 95–989Section 745(a) indicates that each account held by a customer in a separate capacity is to be considered a separate account. This prevents the offset of accounts held in different capacities. Subsection (b) indicates that a bank or another stockbroker that is a customer of a debtor is considered to hold its customers accounts in separate capacities. Thus a bank or other stockbroker is not treated as a mutual fund for purposes of bulk investment. This protects unrelated customers of a bank or other stockholder from having their accounts offset. Subsection (c) effects the same result with respect to a trust so that each beneficiary is treated as the customer of the debtor rather than the trust itself. This eliminates any doubt whether a trustee holds a personal account in a separate capacity from his trustee’s account.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
References in TextThe Internal Revenue Code of 1986, referred to in subsec. (c), is classified generally to Title 26, Internal Revenue Code.
|
||||
|
||||
Amendments1994—Subsec. (c). Pub. L. 103–394 substituted “Internal Revenue Code of 1986” for “Internal Revenue Code of 1954 (26 U.S.C. 1 et seq.)”. 1984—Subsec. (a). Pub. L. 98–353 inserted “the debtor for” after “by”. 1982—Subsec. (c). Pub. L. 97–222 substituted “Each” for “A”.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 1994 AmendmentAmendment by Pub. L. 103–394 effective Oct. 22, 1994, and not applicable with respect to cases commenced under this title before Oct. 22, 1994, see section 702 of Pub. L. 103–394, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
|
||||
@@ -0,0 +1,51 @@
|
||||
---
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|
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
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||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 746 - Extent of customer claims
|
||||
|
||||
## Text
|
||||
|
||||
(a) If, after the date of the filing of the petition, an entity enters into a transaction with the debtor, in a manner that would have made such entity a customer had such transaction occurred before the date of the filing of the petition, and such transaction was entered into by such entity in good faith and before the qualification under section 322 of this title of a trustee, such entity shall be deemed a customer, and the date of such transaction shall be deemed to be the date of the filing of the petition for the purpose of determining such entity’s net equity.
|
||||
|
||||
(b) An entity does not have a claim as a customer to the extent that such entity transferred to the debtor cash or a security that, by contract, agreement, understanding, or operation of law, is—
|
||||
|
||||
(1) part of the capital of the debtor; or
|
||||
|
||||
(2) subordinated to the claims of any or all creditors.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2613; Pub. L. 97–222, § 12, July 27, 1982, 96 Stat. 238.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
senate report no. 95–989Section 746(a) protects entities who deal in good faith with the debtor after the filing of the petition and before a trustee is appointed by deeming such entities to be customers. The principal application of this section will be in an involuntary case before the order for relief, because § 701(b) requires prompt appointment of an interim trustee after the order for relief. Subsection (b) indicates that an entity who holds securities that are either part of the capital of the debtor or that are subordinated to the claims of any creditor of the debtor is not a customer with respect to those securities. This subsection will apply when the stockbroker has sold securities in itself to the customer or when the customer has otherwise placed such securities in an account with the stockbroker.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments1982—Pub. L. 97–222, § 12(c), substituted “claims” for “claim” in section catchline. Subsec. (a). Pub. L. 97–222, § 12(a), substituted “enters into” for “effects, with respect to cash or a security,”, struck out “with respect to such cash or security” wherever appearing, and substituted “the date of the filing of the petition” for “such date”, and “entered into” for “effected”. Subsec. (b). Pub. L. 97–222, § 12(b), substituted “transferred to the debtor” for “has a claim for” in provisions preceding par. (1), and struck out “is” in par. (2).
|
||||
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|
||||
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|
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|
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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||||
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||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 747 - Subordination of certain customer claims
|
||||
|
||||
## Text
|
||||
|
||||
Except as provided in section 510 of this title, unless all other customer net equity claims have been paid in full, the trustee may not pay in full or pay in part, directly or indirectly, any net equity claim of a customer that was, on the date the transaction giving rise to such claim occurred—
|
||||
|
||||
(1) an insider;
|
||||
|
||||
(2) a beneficial owner of at least five percent of any class of equity securities of the debtor, other than—
|
||||
|
||||
(A) nonconvertible stock having fixed preferential dividend and liquidation rights; or
|
||||
|
||||
(B) interests of limited partners in a limited partnership;
|
||||
|
||||
(3) a limited partner with a participation of at least five percent in the net assets or net profits of the debtor; or
|
||||
|
||||
(4) an entity that, directly or indirectly, through agreement or otherwise, exercised or had the power to exercise control over the management or policies of the debtor.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2613; Pub. L. 97–222, § 13, July 27, 1982, 96 Stat. 238.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
senate report no. 95–989Section 747 subordinates to other customer claims, all claims of a customer who is an insider, a five percent owner of the debtor, or otherwise in control of the debtor.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments1982—Pub. L. 97–222 substituted “the transaction giving rise to such claim occurred” for “such claim arose” in provisions preceding par. (1).
|
||||
@@ -0,0 +1,41 @@
|
||||
---
|
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|
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|
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|
||||
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|
||||
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|
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
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||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 748 - Reduction of securities to money
|
||||
|
||||
## Text
|
||||
|
||||
As soon as practicable after the date of the order for relief, the trustee shall reduce to money, consistent with good market practice, all securities held as property of the estate, except for customer name securities delivered or reclaimed under section 751 of this title.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2614.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
senate report no. 95–989Section 748 requires the trustee to liquidate all securities, except for customer name securities, of the estate in a manner consistent with good market practice. The trustee should refrain from flooding a thin market with a large percentage of shares in any one issue. If the trustee holds restricted securities or securities in which trading has been suspended, then the trustee must arrange to liquidate such securities in accordance with the securities laws. A private placement may be the only exemption available with the customer of the debtor the best prospect for such a placement. The subsection does not permit such a customer to bid in his net equity as part of the purchase price; a contrary result would permit a customer to receive a greater percentage on his net equity claim than other customers.
|
||||
@@ -0,0 +1,55 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 749"
|
||||
description: "Voidable transfers"
|
||||
jurisdiction: "us"
|
||||
corpus: "united_states_code"
|
||||
kind: "code_section"
|
||||
title_number: 11
|
||||
title_name: "BANKRUPTCY"
|
||||
chapter_number: "7"
|
||||
chapter_name: "LIQUIDATION"
|
||||
section: "749"
|
||||
citation: "11 U.S.C. § 749"
|
||||
status: "current"
|
||||
release_point: "119-100"
|
||||
release_date: "2026-06-26"
|
||||
source: "official"
|
||||
source_url: "https://uscode.house.gov/download/releasepoints/us/pl/119/100/xml_usc11@119-100.zip"
|
||||
source_identifier: "/us/usc/t11/s749"
|
||||
source_file: "data/legal/raw/us/code/title-11/usc11.xml"
|
||||
source_hash: "92446f3b9422b6ad8a01c0e2f5da4b8d89a5694bc6a553b3dc97a727b4372584"
|
||||
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|
||||
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||||
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|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 749 - Voidable transfers
|
||||
|
||||
## Text
|
||||
|
||||
(a) Except as otherwise provided in this section, any transfer of property that, but for such transfer, would have been customer property, may be avoided by the trustee, and such property shall be treated as customer property, if and to the extent that the trustee avoids such transfer under section 544, 545, 547, 548, or 549 of this title. For the purpose of such sections, the property so transferred shall be deemed to have been property of the debtor and, if such transfer was made to a customer or for a customer’s benefit, such customer shall be deemed, for the purposes of this section, to have been a creditor.
|
||||
|
||||
(b) Notwithstanding sections 544, 545, 547, 548, and 549 of this title, the trustee may not avoid a transfer made before seven days after the order for relief if such transfer is approved by the Commission by rule or order, either before or after such transfer, and if such transfer is—
|
||||
|
||||
(1) a transfer of a securities contract entered into or carried by or through the debtor on behalf of a customer, and of any cash, security, or other property margining or securing such securities contract; or
|
||||
|
||||
(2) the liquidation of a securities contract entered into or carried by or through the debtor on behalf of a customer.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2614; Pub. L. 97–222, § 14, July 27, 1982, 96 Stat. 238; Pub. L. 111–16, § 2(8), May 7, 2009, 123 Stat. 1607.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
senate report no. 95–989Section 749 indicates that if the trustee avoids a transfer, property recovered is customer property to any extent it would have been customer property but for the transfer. The section clarifies that a customer who receives a transfer of property of the debtor is a creditor and that property in a customer’s account is property of a creditor for purposes of the avoiding powers.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments2009—Subsec. (b). Pub. L. 111–16 substituted “seven days” for “five days” in introductory provisions. 1982—Pub. L. 97–222 substituted “(a) Except as otherwise provided in this section, any” for “Any”, and “but” for “except”, inserted “such property”, substituted “or 549” for “549, or 724(a)”, and added subsec. (b).
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 2009 AmendmentAmendment by Pub. L. 111–16 effective Dec. 1, 2009, see section 7 of Pub. L. 111–16, set out as a note under section 109 of this title.
|
||||
@@ -0,0 +1,41 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 750"
|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
section: "750"
|
||||
citation: "11 U.S.C. § 750"
|
||||
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|
||||
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|
||||
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|
||||
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||||
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|
||||
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|
||||
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|
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|
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|
||||
retrieved_at: "2026-07-04"
|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 750 - Distribution of securities
|
||||
|
||||
## Text
|
||||
|
||||
The trustee may not distribute a security except under section 751 of this title.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2614.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
senate report no. 95–989Section 750 forbids the trustee from distributing a security other than a customer name security. The term “distribution” refers to a distribution to customers in satisfaction of net equity claims and is not intended to preclude the trustee from liquidating securities under proposed 11 U.S.C. 748.
|
||||
@@ -0,0 +1,41 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 751"
|
||||
description: "Customer name securities"
|
||||
jurisdiction: "us"
|
||||
corpus: "united_states_code"
|
||||
kind: "code_section"
|
||||
title_number: 11
|
||||
title_name: "BANKRUPTCY"
|
||||
chapter_number: "7"
|
||||
chapter_name: "LIQUIDATION"
|
||||
section: "751"
|
||||
citation: "11 U.S.C. § 751"
|
||||
status: "current"
|
||||
release_point: "119-100"
|
||||
release_date: "2026-06-26"
|
||||
source: "official"
|
||||
source_url: "https://uscode.house.gov/download/releasepoints/us/pl/119/100/xml_usc11@119-100.zip"
|
||||
source_identifier: "/us/usc/t11/s751"
|
||||
source_file: "data/legal/raw/us/code/title-11/usc11.xml"
|
||||
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||||
retrieved_at: "2026-07-04"
|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 751 - Customer name securities
|
||||
|
||||
## Text
|
||||
|
||||
The trustee shall deliver any customer name security to or on behalf of the customer entitled to such security, unless such customer has a negative net equity. With the approval of the trustee, a customer may reclaim a customer name security after payment to the trustee, within such period as the trustee allows, of any claim of the debtor against such customer to the extent that such customer will not have a negative net equity after such payment.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2614.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
senate report no. 95–989Section 751 requires the trustee to deliver a customer name security to the customer entitled to such security unless the customer has a negative net equity. The customer’s net equity will be negative when the amount owed by the customer to the stockbroker exceeds the liquidation value of the non-customer name securities in the customer’s account. If the customer is a net debtor of the stockbroker, then the trustee may permit the customer to repay debts to the stockbroker so that the customer will no longer be in debt to the stockbroker. If the customer refuses to pay such amount, then the court may order the customer to endorse the security in order that the trustee may liquidate such property.
|
||||
@@ -0,0 +1,57 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 752"
|
||||
description: "Customer property"
|
||||
jurisdiction: "us"
|
||||
corpus: "united_states_code"
|
||||
kind: "code_section"
|
||||
title_number: 11
|
||||
title_name: "BANKRUPTCY"
|
||||
chapter_number: "7"
|
||||
chapter_name: "LIQUIDATION"
|
||||
section: "752"
|
||||
citation: "11 U.S.C. § 752"
|
||||
status: "current"
|
||||
release_point: "119-100"
|
||||
release_date: "2026-06-26"
|
||||
source: "official"
|
||||
source_url: "https://uscode.house.gov/download/releasepoints/us/pl/119/100/xml_usc11@119-100.zip"
|
||||
source_identifier: "/us/usc/t11/s752"
|
||||
source_file: "data/legal/raw/us/code/title-11/usc11.xml"
|
||||
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|
||||
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|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 752 - Customer property
|
||||
|
||||
## Text
|
||||
|
||||
(a) The trustee shall distribute customer property ratably to customers on the basis and to the extent of such customers’ allowed net equity claims and in priority to all other claims, except claims of the kind specified in section 507(a)(2) of this title that are attributable to the administration of such customer property.
|
||||
|
||||
(b) (1) The trustee shall distribute customer property in excess of that distributed under subsection (a) of this section in accordance with section 726 of this title.
|
||||
|
||||
(2) Except as provided in section 510 of this title, if a customer is not paid the full amount of such customer’s allowed net equity claim from customer property, the unpaid portion of such claim is a claim entitled to distribution under section 726 of this title.
|
||||
|
||||
(c) Any cash or security remaining after the liquidation of a security interest created under a security agreement made by the debtor, excluding property excluded under section 741(4)(B) of this title, shall be apportioned between the general estate and customer property in the same proportion as the general estate of the debtor and customer property were subject to such security interest.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2614; Pub. L. 97–222, § 15, July 27, 1982, 96 Stat. 238; Pub. L. 98–353, title III, § 484, July 10, 1984, 98 Stat. 383; Pub. L. 109–8, title XV, § 1502(a)(3), Apr. 20, 2005, 119 Stat. 216.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
senate report no. 95–989Section 752(a) requires the trustee to distribute customer property to customers based on the amount of their net equity claims. Customer property is to be distributed in priority to all claims except expenses of administration entitled to priority under § 507(1). It is anticipated that the court will apportion such administrative claims on an equitable basis between the general estate and the customer property of the debtor. Subsection (b)(1) indicates that in the event customer property exceeds customers net equity claims and administrative expenses, the excess pours over into the general estate. This event would occur if the value of securities increased dramatically after the order for relief but before liquidation by the trustee. Subsection (b)(2) indicates that the unpaid portion of a customer’s net equity claim is entitled to share in the general estate as an unsecured claim unless subordinated by the court under proposed 11 U.S.C. 501. A net equity claim of a customer that is subordinated under section 747 is entitled to share in distribution under section 726(a)(2) unless subordinated under section 510 independently of the subordination under section 747. Subsection (c) provides for apportionment between customer property and the general estate of any equity of the debtor in property remaining after a secured creditor liquidates a security interest. This might occur if a stockbroker hypothecates securities of his own and of his customers if the value of the hypothecated securities exceeds the debt owed to the secured party. The apportionment is to be made according to the ratio of customer property and general property of the debtor that comprised the collateral. The subsection refers to cash and securities of customers to include any customer property unlawfully converted by the stockbroker in the course of such a transaction. The apportionment is made subject to section 741(4)(B) to insure that property in a customer’s account that is owed to the stockbroker will not be considered customer property. This recognizes the right of the stockbroker to withdraw money that has been erroneously placed in a customer’s account or that is otherwise owing to the stockbroker.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments2005—Subsec. (a). Pub. L. 109–8 substituted “507(a)(2)” for “507(a)(1)”. 1984—Subsec. (a). Pub. L. 98–353, § 484(a), substituted “customers’ allowed” for “customers allowed”, “except claims of the kind” for “except claims”, and “such customer property” for “customer property”. Subsec. (b)(2). Pub. L. 98–353, § 484(b), substituted “section 726” for “section 726(a)”. 1982—Subsec. (c). Pub. L. 97–222 substituted “Any cash or security remaining after the liquidation of a security interest created under a security agreement made by the debtor, excluding property excluded under section 741(4)(B) of this title, shall be apportioned between the general estate and customer property in the same proportion as the general estate of the debtor and customer property were subject to such security interest” for “Subject to section 741(4)(B) of this title, any cash or security remaining after the liquidation of a security interest created under a security agreement made by the debtor shall be apportioned between the general estate and customer property in the proportion that the general property of the debtor and the cash or securities of customers were subject to such security interest”.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 2005 AmendmentAmendment by Pub. L. 109–8 effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
|
||||
@@ -0,0 +1,41 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 753"
|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
citation: "11 U.S.C. § 753"
|
||||
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|
||||
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|
||||
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|
||||
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||||
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||||
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|
||||
confidence: "official"
|
||||
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|
||||
---
|
||||
|
||||
# 11 U.S.C. § 753 - Stockbroker liquidation and forward contract merchants, commodity brokers, stockbrokers, financial institutions, financial participants, securities clearing agencies, swap participants, repo participants, and master netting agreement participants
|
||||
|
||||
## Text
|
||||
|
||||
Notwithstanding any other provision of this title, the exercise of rights by a forward contract merchant, commodity broker, stockbroker, financial institution, financial participant, securities clearing agency, swap participant, repo participant, or master netting agreement participant under this title shall not affect the priority of any unsecured claim it may have after the exercise of such rights.
|
||||
|
||||
(Added Pub. L. 109–8, title IX, § 907(m), Apr. 20, 2005, 119 Stat. 181.)
|
||||
|
||||
## Notes
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective DateSection effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as an Effective Date of 2005 Amendment note under section 101 of this title.
|
||||
@@ -0,0 +1,201 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 761"
|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
section: "761"
|
||||
citation: "11 U.S.C. § 761"
|
||||
status: "current"
|
||||
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|
||||
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|
||||
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|
||||
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|
||||
source_identifier: "/us/usc/t11/s761"
|
||||
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|
||||
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|
||||
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|
||||
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|
||||
retrieved_at: "2026-07-04"
|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 761 - Definitions for this subchapter
|
||||
|
||||
## Text
|
||||
|
||||
In this subchapter—
|
||||
|
||||
(1) “Act” means Commodity Exchange Act;
|
||||
|
||||
(2) “clearing organization” means a derivatives clearing organization registered under the Act;
|
||||
|
||||
(3) “Commission” means Commodity Futures Trading Commission;
|
||||
|
||||
(4) “commodity contract” means—
|
||||
|
||||
(A) with respect to a futures commission merchant, contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade;
|
||||
|
||||
(B) with respect to a foreign futures commission merchant, foreign future;
|
||||
|
||||
(C) with respect to a leverage transaction merchant, leverage transaction;
|
||||
|
||||
(D) with respect to a clearing organization, contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade that is cleared by such clearing organization, or commodity option traded on, or subject to the rules of, a contract market or board of trade that is cleared by such clearing organization;
|
||||
|
||||
(E) with respect to a commodity options dealer, commodity option;
|
||||
|
||||
(F) (i) any other contract, option, agreement, or transaction that is similar to a contract, option, agreement, or transaction referred to in this paragraph; and
|
||||
|
||||
(ii) with respect to a futures commission merchant or a clearing organization, any other contract, option, agreement, or transaction, in each case, that is cleared by a clearing organization;
|
||||
|
||||
(G) any combination of the agreements or transactions referred to in this paragraph;
|
||||
|
||||
(H) any option to enter into an agreement or transaction referred to in this paragraph;
|
||||
|
||||
(I) a master agreement that provides for an agreement or transaction referred to in subparagraph (A), (B), (C), (D), (E), (F), (G), or (H), together with all supplements to such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a commodity contract under this paragraph, except that the master agreement shall be considered to be a commodity contract under this paragraph only with respect to each agreement or transaction under the master agreement that is referred to in subparagraph (A), (B), (C), (D), (E), (F), (G), or (H); or
|
||||
|
||||
(J) any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in this paragraph, including any guarantee or reimbursement obligation by or to a commodity broker or financial participant in connection with any agreement or transaction referred to in this paragraph, but not to exceed the damages in connection with any such agreement or transaction, measured in accordance with section 562;
|
||||
|
||||
(5) “commodity option” means agreement or transaction subject to regulation under section 4c(b) of the Act;
|
||||
|
||||
(6) “commodity options dealer” means person that extends credit to, or that accepts cash, a security, or other property from, a customer of such person for the purchase or sale of an interest in a commodity option;
|
||||
|
||||
(7) “contract market” means a registered entity;
|
||||
|
||||
(8) “contract of sale”, “commodity”, “derivatives clearing organization”, “future delivery”, “board of trade”, “registered entity”, and “futures commission merchant” have the meanings assigned to those terms in the Act;
|
||||
|
||||
(9) “customer” means—
|
||||
|
||||
(A) with respect to a futures commission merchant—
|
||||
|
||||
(i) entity for or with whom such futures commission merchant deals and that holds a claim against such futures commission merchant on account of a commodity contract made, received, acquired, or held by or through such futures commission merchant in the ordinary course of such futures commission merchant’s business as a futures commission merchant from or for a commodity contract account of such entity; or
|
||||
|
||||
(ii) entity that holds a claim against such futures commission merchant arising out of—
|
||||
|
||||
(I) the making, liquidation, or change in the value of a commodity contract of a kind specified in clause (i) of this subparagraph;
|
||||
|
||||
(II) a deposit or payment of cash, a security, or other property with such futures commission merchant for the purpose of making or margining such a commodity contract; or
|
||||
|
||||
(III) the making or taking of delivery on such a commodity contract;
|
||||
|
||||
(B) with respect to a foreign futures commission merchant—
|
||||
|
||||
(i) entity for or with whom such foreign futures commission merchant deals and that holds a claim against such foreign futures commission merchant on account of a commodity contract made, received, acquired, or held by or through such foreign futures commission merchant in the ordinary course of such foreign futures commission merchant’s business as a foreign futures commission merchant from or for the foreign futures account of such entity; or
|
||||
|
||||
(ii) entity that holds a claim against such foreign futures commission merchant arising out of—
|
||||
|
||||
(I) the making, liquidation, or change in value of a commodity contract of a kind specified in clause (i) of this subparagraph;
|
||||
|
||||
(II) a deposit or payment of cash, a security, or other property with such foreign futures commission merchant for the purpose of making or margining such a commodity contract; or
|
||||
|
||||
(III) the making or taking of delivery on such a commodity contract;
|
||||
|
||||
(C) with respect to a leverage transaction merchant—
|
||||
|
||||
(i) entity for or with whom such leverage transaction merchant deals and that holds a claim against such leverage transaction merchant on account of a commodity contract engaged in by or with such leverage transaction merchant in the ordinary course of such leverage transaction merchant’s business as a leverage transaction merchant from or for the leverage account of such entity; or
|
||||
|
||||
(ii) entity that holds a claim against such leverage transaction merchant arising out of—
|
||||
|
||||
(I) the making, liquidation, or change in value of a commodity contract of a kind specified in clause (i) of this subparagraph;
|
||||
|
||||
(II) a deposit or payment of cash, a security, or other property with such leverage transaction merchant for the purpose of entering into or margining such a commodity contract; or
|
||||
|
||||
(III) the making or taking of delivery on such a commodity contract;
|
||||
|
||||
(D) with respect to a clearing organization, clearing member of such clearing organization with whom such clearing organization deals and that holds a claim against such clearing organization on account of cash, a security, or other property received by such clearing organization to margin, guarantee, or secure a commodity contract in such clearing member’s proprietary account or customers’ account; or
|
||||
|
||||
(E) with respect to a commodity options dealer—
|
||||
|
||||
(i) entity for or with whom such commodity options dealer deals and that holds a claim on account of a commodity contract made, received, acquired, or held by or through such commodity options dealer in the ordinary course of such commodity options dealer’s business as a commodity options dealer from or for the commodity options account of such entity; or
|
||||
|
||||
(ii) entity that holds a claim against such commodity options dealer arising out of—
|
||||
|
||||
(I) the making of, liquidation of, exercise of, or a change in value of, a commodity contract of a kind specified in clause (i) of this subparagraph; or
|
||||
|
||||
(II) a deposit or payment of cash, a security, or other property with such commodity options dealer for the purpose of making, exercising, or margining such a commodity contract;
|
||||
|
||||
(10) “customer property” means cash, a security, or other property, or proceeds of such cash, security, or property, received, acquired, or held by or for the account of the debtor, from or for the account of a customer—
|
||||
|
||||
(A) including—
|
||||
|
||||
(i) property received, acquired, or held to margin, guarantee, secure, purchase, or sell a commodity contract;
|
||||
|
||||
(ii) profits or contractual or other rights accruing to a customer as a result of a commodity contract;
|
||||
|
||||
(iii) an open commodity contract;
|
||||
|
||||
(iv) specifically identifiable customer property;
|
||||
|
||||
(v) warehouse receipt or other document held by the debtor evidencing ownership of or title to property to be delivered to fulfill a commodity contract from or for the account of a customer;
|
||||
|
||||
(vi) cash, a security, or other property received by the debtor as payment for a commodity to be delivered to fulfill a commodity contract from or for the account of a customer;
|
||||
|
||||
(vii) a security held as property of the debtor to the extent such security is necessary to meet a net equity claim based on a security of the same class and series of an issuer;
|
||||
|
||||
(viii) property that was unlawfully converted from and that is the lawful property of the estate; and
|
||||
|
||||
(ix) other property of the debtor that any applicable law, rule, or regulation requires to be set aside or held for the benefit of a customer, unless including such property as customer property would not significantly increase customer property; but
|
||||
|
||||
(B) not including property to the extent that a customer does not have a claim against the debtor based on such property;
|
||||
|
||||
(11) “foreign future” means contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a board of trade outside the United States;
|
||||
|
||||
(12) “foreign futures commission merchant” means entity engaged in soliciting or accepting orders for the purchase or sale of a foreign future or that, in connection with such a solicitation or acceptance, accepts cash, a security, or other property, or extends credit to margin, guarantee, or secure any trade or contract that results from such a solicitation or acceptance;
|
||||
|
||||
(13) “leverage transaction” means agreement that is subject to regulation under section 19 of the Commodity Exchange Act, and that is commonly known to the commodities trade as a margin account, margin contract, leverage account, or leverage contract;
|
||||
|
||||
(14) “leverage transaction merchant” means person in the business of engaging in leverage transactions;
|
||||
|
||||
(15) “margin payment” means payment or deposit of cash, a security, or other property, that is commonly known to the commodities trade as original margin, initial margin, maintenance margin, or variation margin, including mark-to-market payments, settlement payments, variation payments, daily settlement payments, and final settlement payments made as adjustments to settlement prices;
|
||||
|
||||
(16) “member property” means customer property received, acquired, or held by or for the account of a debtor that is a clearing organization, from or for the proprietary account of a customer that is a clearing member of the debtor; and
|
||||
|
||||
(17) “net equity” means, subject to such rules and regulations as the Commission promulgates under the Act, with respect to the aggregate of all of a customer’s accounts that such customer has in the same capacity—
|
||||
|
||||
(A) the balance remaining in such customer’s accounts immediately after—
|
||||
|
||||
(i) all commodity contracts of such customer have been transferred, liquidated, or become identified for delivery; and
|
||||
|
||||
(ii) all obligations of such customer in such capacity to the debtor have been offset; plus
|
||||
|
||||
(B) the value, as of the date of return under section 766 of this title, of any specifically identifiable customer property actually returned to such customer before the date specified in subparagraph (A) of this paragraph; plus
|
||||
|
||||
(C) the value, as of the date of transfer, of—
|
||||
|
||||
(i) any commodity contract to which such customer is entitled that is transferred to another person under section 766 of this title; and
|
||||
|
||||
(ii) any cash, security, or other property of such customer transferred to such other person under section 766 of this title to margin or secure such transferred commodity contract.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2615; Pub. L. 97–222, § 16, July 27, 1982, 96 Stat. 238; Pub. L. 98–353, title III, § 485, July 10, 1984, 98 Stat. 383; Pub. L. 103–394, title V, § 501(d)(29), Oct. 22, 1994, 108 Stat. 4146; Pub. L. 106–554, § 1(a)(5) [title I, § 112(c)(6)], Dec. 21, 2000, 114 Stat. 2763, 2763A–395; Pub. L. 109–8, title IX, § 907(a)(3), Apr. 20, 2005, 119 Stat. 174; Pub. L. 111–203, title VII, § 724(b), July 21, 2010, 124 Stat. 1684.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
legislative statementsSubchapter IV of chapter 7 represents a compromise between similar chapters in the House bill and Senate amendment. Section 761(2) of the House amendment defines “clearing organization” to cover an organization that clears commodity contracts on a contract market or a board of trade; the expansion of the definition is intended to include clearing organizations that clear commodity options. Section 761(4) of the House amendment adopts the term “commodity contract” as used in section 761(5) of the Senate amendment but with the more precise substantive definitions contained in section 761(8) of the House bill. The definition is modified to insert “board of trade” to cover commodity options. Section 761(5) of the House amendment adopts the definition contained in section 761(6) of the Senate amendment in preference to the definition contained in section 761(4) of the House bill which erroneously included onions. Section 761(9) of the House amendment represents a compromise between similar provisions contained in section 761(10) of the Senate amendment and section 761(9) of the House bill. The compromise adopts the substance contained in the House bill and adopts the terminology of “commodity contract” in lieu of “contractual commitment” as suggested in the Senate amendment. Section 761(10) of the House amendment represents a compromise between similar sections in the House bill and Senate amendment regarding the definition of “customer property.” The definition of “distribution share” contained in section 761(12) of the Senate amendment is deleted as unnecessary. Section 761(12) of the House amendment adopts a definition of “foreign futures commission merchant” similar to the definition contained in section 761(14) of the Senate amendment. The definition is modified to cover either an entity engaged in soliciting orders or the purchase or sale of a foreign future, or an entity that accepts cash, a security, or other property for credit in connection with such a solicitation or acceptance. Section 761(13) of the House amendment adopts a definition of “leverage transaction” identical to the definition contained in section 761(15) of the Senate amendment. Section 761(15) of the House amendment adopts the definition of “margin payment” contained in section 761(17) of the Senate amendment. Section 761(17) of the House amendment adopts a definition of “net equity” derived from section 761(15) of the House bill.
|
||||
|
||||
senate report no. 95–989Paragraph (1) defines “Act” to mean the Commodity Exchange Act [7 U.S.C. 1 et seq.]. Paragraph (2) defines “clearing organization” to mean an organization that clears (i.e., matches purchases and sales) commodity futures contracts made on or subject to the rules of a contract market or commodity options transactions made on or subject to the rules of a commodity option exchange. Although commodity option trading on exchanges is currently prohibited, it is anticipated that CFTC may permit such trading in the future. Paragraphs (3) and (4) define terms “Commission” and “commodity futures contract”. Paragraph (5) [enacted as (4)] defines “commodity contract” to mean a commodity futures contract (§ 761(4)), a commodity option (§ 761(6)), or a leverage contract (§ 761(15)). Paragraph (b) [probably should be “(6)” which was enacted as (5)] defines “commodity option” by reference to section 4c(b) of the Commodity Exchange Act [7 U.S.C. 6c(b)]. Paragraphs (7), (8), and (9) [enacted as (6), (7), and (8)] define “commodity options dealer,” “contract market,” “contract of sale,” “commodity,” “future delivery,” “board of trade,” and “futures commission merchant.” Paragraph (10) [enacted as (9)] defines the term “customer” to mean with respect to a futures commission merchant or a foreign futures commission merchant, the entity for whom the debtor carries a commodity futures contract or foreign future, or with whom such a contract is carried (such as another commodity broker), or from whom the debtor has received, acquired, or holds cash, securities, or other property arising out of or connected with specified transactions involving commodity futures contracts or foreign futures. This section also defines “customer” in the context of leverage transaction merchants, clearing organizations, and commodity options dealers. Persons associated with a commodity broker, such as its employees, officers, or partners, may be customers under this definition. The definition of “customer” serves to isolate that class of persons entitled to the protection subchapter IV provides to customers. In addition, section 101(5) defines “commodity broker” to mean a futures commission merchant, foreign futures commission merchant, clearing organization, leverage transaction merchant, or commodity options dealer, with respect to which there is a customer. Accordingly, the definition of customer also serves to designate those entities which must utilize chapter 7 and are precluded from reorganizing under chapter 11. Paragraph (11) [enacted as (10)] defines “customer property” to mean virtually all property or proceeds thereof, received, acquired, or held by or for the account of the debtor for a customer arising out of or in connection with a transaction involving a commodity contract. Paragraph (12) defines “distribution share” to mean the amount to which a customer is entitled under section 765(a). Paragraphs (13), (14), (15), and (16) [enacted as (11), (12), (13), and (14)] define “foreign future,” “foreign futures commission merchant,” “leverage transaction,” and “leverage transaction merchant.” Paragraph (17) [enacted as (15)] defines “margin payment” to mean a payment or deposit commonly known to the commodities trade as original margin, initial margin, or variation margin. Paragraph (18) [enacted as (16)] defines “member property.” Paragraph (19) [enacted as (17)] defines “net equity” to be the sum of (A) the value of all customer property remaining in a customer’s account immediately after all commodity contracts of such customer have been transferred, liquidated, or become identified for delivery and all obligations of such customer to the debtor have been offset (such as margin payments, whether or not called, and brokerage commissions) plus (B) the value of specifically identifiable customer property previously returned to the customer by the trustee, plus (C) if the trustee has transferred any commodity contract to which the customer is entitled or any margin or security for such contract, the value of such contract and margin or security. Net equity, therefore, will be the total amount of customer property to which a customer is entitled as of the date of the filing of the bankruptcy petition, although valued at subsequent dates. The Commission is given authority to promulgate rules and regulations to further refine this definition.
|
||||
|
||||
house report no. 95–595Paragraph (8) [enacted as (4)] is a dynamic definition of “contractual commitment”. The definition will vary depending on the character of the debtor in each case. If the debtor is a futures commission merchant or a clearing organization, then subparagraphs (A) and (D) indicate that the definition means a contract of sale of a commodity for future delivery on a contract market. If the debtor is a foreign futures commission merchant, a leverage transaction merchant, or a commodity options dealer, then subparagraphs (B), (C), and (E) indicate that the definition means foreign future, leverage transaction, or commodity option, respectively. Paragraph (9) defines “customer” in a similar style. It is anticipated that a debtor with multifaceted characteristics will have separate estates for each different kind of customer. Thus, a debtor that is a leverage transaction merchant and a commodity options dealer would have separate estates for the leverage transaction customers and for the options customers, and a general estate for other creditors. Customers for each kind of commodity broker, except the clearing organization, arise from either of two relationships. In subparagraphs (A), (B), (C), and (E), clause (i) treats with customers to the extent of contractual commitments with the debtor in either a broker or a dealer relationship. Clause (ii) treats with customers to the extent of proceeds from contractual commitments or deposits for the purpose of making contractual commitments. The customer of the clearing organization is a member with a proprietary or customers’ account. Paragraph (10) defines “customer property” to include all property in customer accounts and property that should have been in those accounts but was diverted through conversion or mistake. Clause (i) refers to customer property not properly segregated by the debtor or customer property converted and then recovered so as to become property of the estate. Clause (vii) is intended to exclude property that would cost more to recover from a third party than the value of the property itself. Subparagraph (B) excludes property in a customer’s account that belongs to the commodity broker, such as a contract placed in the account by error, or cash due the broker for a margin payment that the broker has made. Paragraph (15) [enacted as (17)] defines “net equity” to include the value of all contractual commitments at the time of liquidation or transfer less any obligations owed by the customer to the debtor, such as brokerage fees. In addition, the term includes the value of any specifically identifiable property as of the date of return to the customer and the value of any customer property transferred to another commodity broker as of the date of transfer. This definition places the risk of market fluctuations on the customer until commitments leave the estate.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
References in TextThe Commodity Exchange Act, referred to in pars. (1), (2), (8), and (17), is act Sept. 21, 1922, ch. 369, 42 Stat. 998, which is classified generally to chapter 1 (§ 1 et seq.) of Title 7, Agriculture. Sections 4c(b) and 19 of the Act are classified to sections 6c(b) and 23, respectively, of Title 7. For complete classification of this Act to the Code, see section 1 of Title 7 and Tables.
|
||||
|
||||
Amendments2010—Par. (4)(F). Pub. L. 111–203, § 724(b)(1), added subpar. (F) and struck out former subpar. (F) which read as follows: “any other agreement or transaction that is similar to an agreement or transaction referred to in this paragraph;”. Par. (9)(A)(i). Pub. L. 111–203, § 724(b)(2), substituted “a commodity contract account” for “the commodity futures account”. 2005—Par. (4)(F) to (J). Pub. L. 109–8 added subpars. (F) to (J). 2000—Par. (2). Pub. L. 106–554, § 1(a)(5) [title I, § 112(c)(6)(A)], amended par. (2) generally. Prior to amendment, par. (2) read as follows: “ ‘clearing organization’ means organization that clears commodity contracts made on, or subject to the rules of, a contract market or board of trade;”. Par. (7). Pub. L. 106–554, § 1(a)(5) [title I, § 112(c)(6)(B)], amended par. (7) generally. Prior to amendment, par. (7) read as follows: “ ‘contract market’ means board of trade designated as a contract market by the Commission under the Act;”. Par. (8). Pub. L. 106–554, § 1(a)(5) [title I, § 112(c)(6)(C)], amended par. (8) generally. Prior to amendment, par. (8) read as follows: “ ‘contract of sale’, ‘commodity’, ‘future delivery’, ‘board of trade’, and ‘futures commission merchant’ have the meanings assigned to those terms in the Act;”. 1994—Par. (1). Pub. L. 103–394, § 501(d)(29)(A), struck out “(7 U.S.C. 1 et seq.)” after “Act”. Par. (5). Pub. L. 103–394, § 501(d)(29)(B), struck out “(7 U.S.C. 6c(b))” after “Act”. Par. (13). Pub. L. 103–394, § 501(d)(29)(C), struck out “(7 U.S.C. 23)” after “Act”. 1984—Par. (10)(A)(viii). Pub. L. 98–353 substituted “from and that is the lawful property” for “and that is property”. 1982—Par. (2). Pub. L. 97–222, § 16(1), inserted “made” after “commodity contracts”. Par. (4). Pub. L. 97–222, § 16(2), substituted “with respect to” for “if the debtor is” wherever appearing, and substituted “cleared by such clearing organization, or commodity option traded on, or subject to the rules of, a contract market or board of trade that is cleared by such clearing organization” for “cleared by the debtor” in subpar. (D). Par. (9). Pub. L. 97–222, § 16(3), substituted “with respect to” for “if the debtor is” wherever appearing, in subpar. (A) substituted “such futures commission merchant” for “the debtor” wherever appearing and “such futures commission merchant’s” for “the debtor’s”, in subpar. (B) substituted “such foreign futures commission merchant” for “the debtor” wherever appearing and “such foreign futures commission merchant’s” for “the debtor’s”, in subpar. (C) substituted “such leverage transaction merchant” for “the debtor” wherever appearing and “such leverage transaction merchant’s” for “the debtor’s”, inserted “or” after the semicolon in cl. (i), and substituted “holds” for “hold” in cl. (ii), in subpar. (D) substituted “such clearing organization” for “the debtor” wherever appearing, and in subpar. (E) substituted “such commodity options dealer” for “the debtor” wherever appearing and “such commodity options dealer’s” for “the debtor’s”. Par. (10). Pub. L. 97–222, § 16(4), struck out “at any time” after “security, or property,” in provisions preceding subpar. (A). Par. (12). Pub. L. 97–222, § 16(5), inserted a comma after “property” and struck out the comma after “credit”. Par. (13). Pub. L. 97–222, § 16(6), substituted “section 19 of the Commodity Exchange Act (7 U.S.C. 23)” for “section 217 of the Commodity Futures Trading Commission Act of 1974 (7 U.S.C. 15a)”. Par. (14). Pub. L. 97–222, § 16(7), struck out “that is engaged” after “means person”. Par. (15). Pub. L. 97–222, § 16(8), substituted “mark-to-market payments, settlement payments, variation payments, daily settlement payments, and final settlement payments made as adjustments to settlement prices” for “a daily variation settlement payment”. Par. (16). Pub. L. 97–222, § 16(9), struck out “at any time” after “customer property”. Par. (17). Pub. L. 97–222, § 16(10), in provisions preceding subpar. (A) substituted “has” for “holds”, in subpar. (A) inserted “the” after “(A)” in provisions preceding cl. (i), and “in such capacity” after “customer” in cl. (ii).
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 2010 AmendmentAmendment by Pub. L. 111–203 effective on the later of 360 days after July 21, 2010, or, to the extent a provision of subtitle A (§§ 711–754) of title VII of Pub. L. 111–203 requires a rulemaking, not less than 60 days after publication of the final rule or regulation implementing such provision of subtitle A, see section 754 of Pub. L. 111–203, set out as a note under section 1a of Title 7, Agriculture.
|
||||
|
||||
Effective Date of 2005 AmendmentAmendment by Pub. L. 109–8 effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1994 AmendmentAmendment by Pub. L. 103–394 effective Oct. 22, 1994, and not applicable with respect to cases commenced under this title before Oct. 22, 1994, see section 702 of Pub. L. 103–394, set out as a note under section 101 of this title.
|
||||
|
||||
Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
|
||||
@@ -0,0 +1,43 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 762"
|
||||
description: "Notice to the Commission and right to be heard"
|
||||
jurisdiction: "us"
|
||||
corpus: "united_states_code"
|
||||
kind: "code_section"
|
||||
title_number: 11
|
||||
title_name: "BANKRUPTCY"
|
||||
chapter_number: "7"
|
||||
chapter_name: "LIQUIDATION"
|
||||
section: "762"
|
||||
citation: "11 U.S.C. § 762"
|
||||
status: "current"
|
||||
release_point: "119-100"
|
||||
release_date: "2026-06-26"
|
||||
source: "official"
|
||||
source_url: "https://uscode.house.gov/download/releasepoints/us/pl/119/100/xml_usc11@119-100.zip"
|
||||
source_identifier: "/us/usc/t11/s762"
|
||||
source_file: "data/legal/raw/us/code/title-11/usc11.xml"
|
||||
source_hash: "20fd678d801fc469af94b1a3bf9255085cae1b680716e56c575329ad71194268"
|
||||
raw_snapshot_hash: "49b32bf784de01de21874d64b5d1d78d1d245352824a03caa6d6b941a4a2c9a2"
|
||||
text_hash: "010ac7480f742e3c76ec280334036f7b6516ddaddba021d9e1685ae04a94d227"
|
||||
retrieved_at: "2026-07-04"
|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 762 - Notice to the Commission and right to be heard
|
||||
|
||||
## Text
|
||||
|
||||
(a) The clerk shall give the notice required by section 342 of this title to the Commission.
|
||||
|
||||
(b) The Commission may raise and may appear and be heard on any issue in a case under this chapter.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2618.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
senate report no. 95–989Section 762 provides that the Commission shall be given such notice as is appropriate of an order for relief in a bankruptcy case and that the Commission may raise and may appear and may be heard on any issue in case involving a commodity broker liquidation.
|
||||
@@ -0,0 +1,53 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 763"
|
||||
description: "Treatment of accounts"
|
||||
jurisdiction: "us"
|
||||
corpus: "united_states_code"
|
||||
kind: "code_section"
|
||||
title_number: 11
|
||||
title_name: "BANKRUPTCY"
|
||||
chapter_number: "7"
|
||||
chapter_name: "LIQUIDATION"
|
||||
section: "763"
|
||||
citation: "11 U.S.C. § 763"
|
||||
status: "current"
|
||||
release_point: "119-100"
|
||||
release_date: "2026-06-26"
|
||||
source: "official"
|
||||
source_url: "https://uscode.house.gov/download/releasepoints/us/pl/119/100/xml_usc11@119-100.zip"
|
||||
source_identifier: "/us/usc/t11/s763"
|
||||
source_file: "data/legal/raw/us/code/title-11/usc11.xml"
|
||||
source_hash: "18ee2af16210f2448de08f1a9a59f02a94b16d3d0d2ce78a5044cf255c7627b6"
|
||||
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|
||||
text_hash: "44bc7db842fb5142b47130432e2795b98094b9f8419816ce27e3699f1b33c1df"
|
||||
retrieved_at: "2026-07-04"
|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 763 - Treatment of accounts
|
||||
|
||||
## Text
|
||||
|
||||
(a) Accounts held by the debtor for a particular customer in separate capacities shall be treated as accounts of separate customers.
|
||||
|
||||
(b) A member of a clearing organization shall be deemed to hold such member’s proprietary account in a separate capacity from such member’s customers’ account.
|
||||
|
||||
(c) The net equity in a customer’s account may not be offset against the net equity in the account of any other customer.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2618; Pub. L. 98–353, title III, § 486, July 10, 1984, 98 Stat. 383.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
senate report no. 95–989Section 763 provides for separate treatment of accounts held in separate capacities. A deficit in one account held for a customer may not be offset against the net equity in another account held by the same customer in a separate capacity or held by another customer.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments1984—Subsec. (a). Pub. L. 98–353 substituted “by the debtor for” for “by” and “treated as” for “deemed to be”.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
|
||||
@@ -0,0 +1,61 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 764"
|
||||
description: "Voidable transfers"
|
||||
jurisdiction: "us"
|
||||
corpus: "united_states_code"
|
||||
kind: "code_section"
|
||||
title_number: 11
|
||||
title_name: "BANKRUPTCY"
|
||||
chapter_number: "7"
|
||||
chapter_name: "LIQUIDATION"
|
||||
section: "764"
|
||||
citation: "11 U.S.C. § 764"
|
||||
status: "current"
|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
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|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 764 - Voidable transfers
|
||||
|
||||
## Text
|
||||
|
||||
(a) Except as otherwise provided in this section, any transfer by the debtor of property that, but for such transfer, would have been customer property, may be avoided by the trustee, and such property shall be treated as customer property, if and to the extent that the trustee avoids such transfer under section 544, 545, 547, 548, 549, or 724(a) of this title. For the purpose of such sections, the property so transferred shall be deemed to have been property of the debtor, and, if such transfer was made to a customer or for a customer’s benefit, such customer shall be deemed, for the purposes of this section, to have been a creditor.
|
||||
|
||||
(b) Notwithstanding sections 544, 545, 547, 548, 549, and 724(a) of this title, the trustee may not avoid a transfer made before seven days after the order for relief, if such transfer is approved by the Commission by rule or order, either before or after such transfer, and if such transfer is—
|
||||
|
||||
(1) a transfer of a commodity contract entered into or carried by or through the debtor on behalf of a customer, and of any cash, securities, or other property margining or securing such commodity contract; or
|
||||
|
||||
(2) the liquidation of a commodity contract entered into or carried by or through the debtor on behalf of a customer.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2618; Pub. L. 97–222, § 17, July 27, 1982, 96 Stat. 240; Pub. L. 98–353, title III, § 487, July 10, 1984, 98 Stat. 383; Pub. L. 111–16, § 2(9), May 7, 2009, 123 Stat. 1607.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision Notes
|
||||
|
||||
legislative statementsSection 764 of the House amendment is derived from the House bill.
|
||||
|
||||
senate report no. 95–989Section 764 permits the trustee to void any transfer of property that, except for such transfer, would have been customer property, to the extent permitted under section 544, 545, 547, 548, 549, or 724(a).
|
||||
|
||||
house report no. 95–595Section 764 indicates the extent to which the avoiding powers may be used by the trustee under subchapter IV of chapter 7. If property recovered would have been customer property if never transferred, then subsection (a) indicates that it will be so treated when recovered. Subsection (b) prohibits avoiding any transaction that occurs before or within five days after the petition if the transaction is approved by the Commission and concerns an open contractual commitment. This enables the Commission to exercise its discretion to protect the integrity of the market by insuring that transactions cleared with other brokers will not be undone on a preference or a fraudulent transfer theory. Subsection (c) insulates variation margin payments and other deposits from the avoiding powers except to the extent of actual fraud under section 548(a)(1). This facilitates prepetition transfers and protects the ordinary course of business in the market.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments2009—Subsec. (b). Pub. L. 111–16 substituted “seven days” for “five days” in introductory provisions. 1984—Subsec. (a). Pub. L. 98–353 substituted “any transfer by the debtor” for “any transfer”. 1982—Subsec. (a). Pub. L. 97–222, § 17(a), substituted “but” for “except”, inserted “such property” after “trustee, and”, and substituted “shall be” for “is” wherever appearing. Subsec. (b). Pub. L. 97–222, § 17(b), substituted “order for relief” for “date of the filing of the petition”. Subsec. (c). Pub. L. 97–222, § 17(c), struck out subsec. (c) which provided that the trustee could not avoid a transfer that was a margin payment to or deposit with a commodity broker or forward contract merchant or was a settlement payment made by a clearing organization and that occurred before the commencement of the case.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 2009 AmendmentAmendment by Pub. L. 111–16 effective Dec. 1, 2009, see section 7 of Pub. L. 111–16, set out as a note under section 109 of this title.
|
||||
|
||||
Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
|
||||
@@ -0,0 +1,53 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
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|
||||
description: "Customer instructions"
|
||||
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|
||||
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|
||||
kind: "code_section"
|
||||
title_number: 11
|
||||
title_name: "BANKRUPTCY"
|
||||
chapter_number: "7"
|
||||
chapter_name: "LIQUIDATION"
|
||||
section: "765"
|
||||
citation: "11 U.S.C. § 765"
|
||||
status: "current"
|
||||
release_point: "119-100"
|
||||
release_date: "2026-06-26"
|
||||
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|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 765 - Customer instructions
|
||||
|
||||
## Text
|
||||
|
||||
(a) The notice required by section 342 of this title to customers shall instruct each customer—
|
||||
|
||||
(1) to file a proof of such customer’s claim promptly, and to specify in such claim any specifically identifiable security, property, or commodity contract; and
|
||||
|
||||
(2) to instruct the trustee of such customer’s desired disposition, including transfer under section 766 of this title or liquidation, of any commodity contract specifically identified to such customer.
|
||||
|
||||
(b) The trustee shall comply, to the extent practicable, with any instruction received from a customer regarding such customer’s desired disposition of any commodity contract specifically identified to such customer. If the trustee has transferred, under section 766 of this title, such a commodity contract, the trustee shall transmit any such instruction to the commodity broker to whom such commodity contract was so transferred.
|
||||
|
||||
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2619; Pub. L. 97–222, § 18, July 27, 1982, 96 Stat. 240; Pub. L. 98–353, title III, § 488, July 10, 1984, 98 Stat. 383.)
|
||||
|
||||
## Notes
|
||||
|
||||
Historical and Revision NotesFor Historical and Revision Notes for this section, see Historical and Revision Notes set out under section 766 of this title.
|
||||
|
||||
Editorial Notes
|
||||
|
||||
Amendments1984—Subsec. (a). Pub. L. 98–353 substituted “notice required by” for “notice under”. 1982—Subsec. (b). Pub. L. 97–222 substituted “commodity contract” for “commitment”.
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective Date of 1984 AmendmentAmendment by Pub. L. 98–353 effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) of Pub. L. 98–353, set out as a note under section 101 of this title.
|
||||
File diff suppressed because one or more lines are too long
@@ -0,0 +1,41 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 767"
|
||||
description: "Commodity broker liquidation and forward contract merchants, commodity brokers, stockbrokers, financial institutions, financial participants, securities clearing agencies, swap participants, repo participants, and master netting agreement participants"
|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
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|
||||
section: "767"
|
||||
citation: "11 U.S.C. § 767"
|
||||
status: "current"
|
||||
release_point: "119-100"
|
||||
release_date: "2026-06-26"
|
||||
source: "official"
|
||||
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||||
source_identifier: "/us/usc/t11/s767"
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|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 767 - Commodity broker liquidation and forward contract merchants, commodity brokers, stockbrokers, financial institutions, financial participants, securities clearing agencies, swap participants, repo participants, and master netting agreement participants
|
||||
|
||||
## Text
|
||||
|
||||
Notwithstanding any other provision of this title, the exercise of rights by a forward contract merchant, commodity broker, stockbroker, financial institution, financial participant, securities clearing agency, swap participant, repo participant, or master netting agreement participant under this title shall not affect the priority of any unsecured claim it may have after the exercise of such rights.
|
||||
|
||||
(Added Pub. L. 109–8, title IX, § 907(l), Apr. 20, 2005, 119 Stat. 181.)
|
||||
|
||||
## Notes
|
||||
|
||||
Statutory Notes and Related Subsidiaries
|
||||
|
||||
Effective DateSection effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as an Effective Date of 2005 Amendment note under section 101 of this title.
|
||||
@@ -0,0 +1,47 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 781"
|
||||
description: "Definitions"
|
||||
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|
||||
corpus: "united_states_code"
|
||||
kind: "code_section"
|
||||
title_number: 11
|
||||
title_name: "BANKRUPTCY"
|
||||
chapter_number: "7"
|
||||
chapter_name: "LIQUIDATION"
|
||||
section: "781"
|
||||
citation: "11 U.S.C. § 781"
|
||||
status: "current"
|
||||
release_point: "119-100"
|
||||
release_date: "2026-06-26"
|
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|
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confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 781 - Definitions
|
||||
|
||||
## Text
|
||||
|
||||
For purposes of this subchapter, the following definitions shall apply:
|
||||
|
||||
(1) Board.— The term “Board” means the Board of Governors of the Federal Reserve System.
|
||||
|
||||
(2) Depository institution.— The term “depository institution” has the same meaning as in section 3 of the Federal Deposit Insurance Act.
|
||||
|
||||
(3) Clearing bank.— The term “clearing bank” means an uninsured State member bank, or a corporation organized under section 25A of the Federal Reserve Act, which operates, or operates as, a multilateral clearing organization pursuant to section 409 11 See References in Text note below. of the Federal Deposit Insurance Corporation Improvement Act of 1991.
|
||||
|
||||
(Added Pub. L. 106–554, § 1(a)(5) [title I, § 112(c)(5)(B)], Dec. 21, 2000, 114 Stat. 2763, 2763A–394.)
|
||||
|
||||
## Notes
|
||||
|
||||
Editorial Notes
|
||||
|
||||
References in TextSection 3 of the Federal Deposit Insurance Act, referred to in par. (2), is classified to section 1813 of Title 12, Banks and Banking. Section 25A of the Federal Reserve Act, referred to in par. (3), popularly known as the Edge Act, is classified to subchapter II (§ 611 et seq.) of chapter 6 of Title 12, Banks and Banking. For complete classification of this Act to the Code, see Short Title note set out under section 611 of Title 12 and Tables. Section 409 of the Federal Deposit Insurance Corporation Improvement Act of 1991, referred to in par. (3), which was classified to section 4422 of Title 12, Banks and Banking, was repealed by Pub. L. 111–203, title VII, § 740, July 21, 2010, 124 Stat. 1729.
|
||||
@@ -0,0 +1,39 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 782"
|
||||
description: "Selection of trustee"
|
||||
jurisdiction: "us"
|
||||
corpus: "united_states_code"
|
||||
kind: "code_section"
|
||||
title_number: 11
|
||||
title_name: "BANKRUPTCY"
|
||||
chapter_number: "7"
|
||||
chapter_name: "LIQUIDATION"
|
||||
section: "782"
|
||||
citation: "11 U.S.C. § 782"
|
||||
status: "current"
|
||||
release_point: "119-100"
|
||||
release_date: "2026-06-26"
|
||||
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|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 782 - Selection of trustee
|
||||
|
||||
## Text
|
||||
|
||||
(a) In General.— (1) Appointment.— Notwithstanding any other provision of this title, the conservator or receiver who files the petition shall be the trustee under this chapter, unless the Board designates an alternative trustee.
|
||||
|
||||
(2) Successor.— The Board may designate a successor trustee if required.
|
||||
|
||||
(b) Authority of Trustee.— Whenever the Board appoints or designates a trustee, chapter 3 and sections 704 and 705 of this title shall apply to the Board in the same way and to the same extent that they apply to a United States trustee.
|
||||
|
||||
(Added Pub. L. 106–554, § 1(a)(5) [title I, § 112(c)(5)(B)], Dec. 21, 2000, 114 Stat. 2763, 2763A–394.)
|
||||
@@ -0,0 +1,61 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 783"
|
||||
description: "Additional powers of trustee"
|
||||
jurisdiction: "us"
|
||||
corpus: "united_states_code"
|
||||
kind: "code_section"
|
||||
title_number: 11
|
||||
title_name: "BANKRUPTCY"
|
||||
chapter_number: "7"
|
||||
chapter_name: "LIQUIDATION"
|
||||
section: "783"
|
||||
citation: "11 U.S.C. § 783"
|
||||
status: "current"
|
||||
release_point: "119-100"
|
||||
release_date: "2026-06-26"
|
||||
source: "official"
|
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source_url: "https://uscode.house.gov/download/releasepoints/us/pl/119/100/xml_usc11@119-100.zip"
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source_identifier: "/us/usc/t11/s783"
|
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source_file: "data/legal/raw/us/code/title-11/usc11.xml"
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|
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confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 783 - Additional powers of trustee
|
||||
|
||||
## Text
|
||||
|
||||
(a) Distribution of Property Not of the Estate.— The trustee under this subchapter has power to distribute property not of the estate, including distributions to customers that are mandated by subchapters III and IV of this chapter.
|
||||
|
||||
(b) Disposition of Institution.— The trustee under this subchapter may, after notice and a hearing—
|
||||
|
||||
(1) sell the clearing bank to a depository institution or consortium of depository institutions (which consortium may agree on the allocation of the clearing bank among the consortium);
|
||||
|
||||
(2) merge the clearing bank with a depository institution;
|
||||
|
||||
(3) transfer contracts to the same extent as could a receiver for a depository institution under paragraphs (9) and (10) of section 11(e) of the Federal Deposit Insurance Act;
|
||||
|
||||
(4) transfer assets or liabilities to a depository institution; and
|
||||
|
||||
(5) transfer assets and liabilities to a bridge depository institution as provided in paragraphs (1), (3)(A), (5), and (6) of section 11(n) of the Federal Deposit Insurance Act, paragraphs (9) through (13) of such section, and subparagraphs (A) through (H) and subparagraph (K) of paragraph (4) of such section 11(n), except that—
|
||||
|
||||
(A) the bridge depository institution to which such assets or liabilities are transferred shall be treated as a clearing bank for the purpose of this subsection; and
|
||||
|
||||
(B) any references in any such provision of law to the Federal Deposit Insurance Corporation shall be construed to be references to the appointing agency and that references to deposit insurance shall be omitted.
|
||||
|
||||
(c) Certain Transfers Included.— Any reference in this section to transfers of liabilities includes a ratable transfer of liabilities within a priority class.
|
||||
|
||||
(Added Pub. L. 106–554, § 1(a)(5) [title I, § 112(c)(5)(B)], Dec. 21, 2000, 114 Stat. 2763, 2763A–395; amended Pub. L. 110–289, div. A, title VI, § 1604(b)(3), July 30, 2008, 122 Stat. 2829.)
|
||||
|
||||
## Notes
|
||||
|
||||
Editorial Notes
|
||||
|
||||
References in TextSection 11 of the Federal Deposit Insurance Act, referred to in subsec. (b)(3), (5), is classified to section 1821 of Title 12, Banks and Banking.
|
||||
|
||||
Amendments2008—Subsec. (b)(5). Pub. L. 110–289, which directed amendment of this section by substituting “bridge depository institution” for “bridge bank”, was executed by making the substitution in introductory provisions and subpar. (A) of subsec. (b)(5), to reflect the probable intent of Congress.
|
||||
@@ -0,0 +1,35 @@
|
||||
---
|
||||
type: "LegalText"
|
||||
title: "11 U.S.C. § 784"
|
||||
description: "Right to be heard"
|
||||
jurisdiction: "us"
|
||||
corpus: "united_states_code"
|
||||
kind: "code_section"
|
||||
title_number: 11
|
||||
title_name: "BANKRUPTCY"
|
||||
chapter_number: "7"
|
||||
chapter_name: "LIQUIDATION"
|
||||
section: "784"
|
||||
citation: "11 U.S.C. § 784"
|
||||
status: "current"
|
||||
release_point: "119-100"
|
||||
release_date: "2026-06-26"
|
||||
source: "official"
|
||||
source_url: "https://uscode.house.gov/download/releasepoints/us/pl/119/100/xml_usc11@119-100.zip"
|
||||
source_identifier: "/us/usc/t11/s784"
|
||||
source_file: "data/legal/raw/us/code/title-11/usc11.xml"
|
||||
source_hash: "ddd372fc91cd3a9fae0ff8cc738e5afad590ab3d957384c590b78f5ee2b1cb29"
|
||||
raw_snapshot_hash: "49b32bf784de01de21874d64b5d1d78d1d245352824a03caa6d6b941a4a2c9a2"
|
||||
text_hash: "4ba817b5924d4283f7f40a97e5949bf91867ad31a235882b96d56db9d9f7a01b"
|
||||
retrieved_at: "2026-07-04"
|
||||
confidence: "official"
|
||||
tags: ["legal", "us-code"]
|
||||
---
|
||||
|
||||
# 11 U.S.C. § 784 - Right to be heard
|
||||
|
||||
## Text
|
||||
|
||||
The Board or a Federal reserve bank (in the case of a clearing bank that is a member of that bank) may raise and may appear and be heard on any issue in a case under this subchapter.
|
||||
|
||||
(Added Pub. L. 106–554, § 1(a)(5) [title I, § 112(c)(5)(B)], Dec. 21, 2000, 114 Stat. 2763, 2763A–395.)
|
||||
Reference in New Issue
Block a user