Intercreditor Agreements in Bankruptcy

November 20, 2012

 

An "intercreditor agreement" can be defined as an agreement that sets forth the relative rights, priorities and remedies among one or more lenders with respect to one or more common debtors. The enforceability of an intercreditor agreement in the context of a bankruptcy case is addressed in Section 510(a) of the Bankruptcy Code, which provides that “[a] subordination agreement is enforceable in a case under this title to the same extent that such agreement is enforceable under applicable nonbankruptcy law.” 11 U.S.C. § 510(a). In view of this seemingly clear, unambiguous language, it would seem that courts considering the enforceability of subordination agreements in the context of a bankruptcy case would only need to review and apply relevant nonbankruptcy law. However, whether an intercreditor agreement is a subordination agreement included within the protection of 11 U.S.C. § 510(a) is a valid question. In fact, earlier case law addressing the enforceability of a subordination agreement, or at least some of its provisions, in the context of a bankruptcy case concluded that the scope of Section 510(a) of the Bankruptcy Code is far narrower than meets the eye.

To read more about this topic, please see full article below

Download PDF


Legal Disclaimer:
No representation is made that the quality of services to be performed is greater than the quality of legal services performed by other lawyers.

Featured Attorneys

send article

TESTIMONIALS

  • “They handle a diverse set of issues – well staffed, well prepared and respected…"

    -Chambers 2012

  • “Very good, very well-rounded, and they have a lot of expertise in multiple fields. They do a very good job and are very cost-effective. They have very capable people at multiple levels, so if it’s associate-level work we’re not getting charged for a partner doing it.”

    - Chambers 2014

  • “He does a good job for his clients.”

    -Chambers 2012

  • “He quickly grasps the issues and tailors the trial and testimony for maximum benefit.”

    -Chambers 2012

  • “I have had the pleasure of working with Jay Price since 1997.  Over the years, he has provided outstanding representation for the banks I have worked for and continues to make the loan closing process a good experience for both the bank and our borrowers.  Even with the growth of Jay’s practice over the years, he always makes me feel as if I am his only client and always provides me top notch service.”

    -Anonymous