S.540 - Bankruptcy Amendments Act of 1994103rd Congress (1993-1994)
Summary: S.540 — 103rd Congress (1993-1994)
Passed Senate amended (04/21/1994)
Title I: Improved Bankruptcy Administration
Title II: Commercial Issues in Bankruptcy
Title III: Consumer Bankruptcy Issues
Title IV: Bankruptcy Review Commission
Title V: Bankruptcy Fraud
Title VI: Technical Corrections
Title VII: Severability; Effective Date; Application of
Title VIII: Miscellaneous Provisions
Bankruptcy Amendments Act of 1994 - Title I: Improved Bankruptcy Administration - Amends Federal bankruptcy law to expedite: (1) hearings on a motion to lift an automatic stay; (2) filing plans under Chapter 11; and (3) procedures for reaffirmation of debts.
(Sec. 104) Permits bankruptcy court judges to hold status conferences and to issue case limitations and conditions at such conferences. Amends the Federal judicial code to mandate that the judicial council of a circuit establish a bankruptcy appellate panel service composed of district bankruptcy judges in the circuit, subject to the consent of all parties. Sets forth appeals guidelines.
(Sec. 105) Permits bankruptcy administrators (in a State in which the bankruptcy system is administered by a Bankruptcy Administrator instead of a U.S. Trustee) to preside at meetings of creditors and equity security holders, and to examine the debtor at creditors' meetings.
(Sec. 106) Amends the Bankruptcy Code to include within the definition of "person" pension benefit guarantors and legal or beneficial owners of an asset of an eligible deferred compensation plan or of a governmental employee pension benefit plan (thus enabling such persons, State pension funds, and the Pension Benefit Guaranty Corporation to serve on creditors' committees).
(Sec. 107) Revises current guidelines to permit increases in incentive compensation for bankruptcy trustees.
(Sec. 108) Increases the dollar limitations and debt limits applicable to specified bankruptcy procedures (thus enlarging the range of debtors eligible to repay debts over a period from regular income (Chapter 13 debtors), and accounting for inflation since 1978).
(Sec. 109) Conforms the premerger notification provisions of the Bankruptcy Code to the requirements for antitrust review of transactions under the Clayton Act.
(Sec. 110) Entitles members of Chapter 11 bankruptcy reorganization committees to reimbursement for actual and necessary expenses.
(Sec. 111) Directs the Judicial Conference of the United States to report to the Congress on efforts to automate and computerize the bankruptcy courts and provide necessary information about the commencement of the case in bankruptcy.
(Sec. 112) Amends the Bankruptcy Rules to prescribe service of process upon an insured depository institution.
(Sec. 113) Requires the U.S. trustee, at the conclusion of any meeting of creditors or equity security holders, to examine the debtor orally and record his or her knowledge of the consequences of filing for bankruptcy.
(Sec. 114) Provides: (1) that the automatic stay provisions of bankruptcy law do not operate against the Internal Revenue Service (thus permitting it to continue to monitor and audit a debtor who has filed for bankruptcy protection); and (2) for additional trustee compensation.
(Sec. 116) Amends Federal law to extend to specified judicial officials who retired on or after August 1, 1987, certain life insurance rules that are currently applicable only to Federal judges.
(Sec. 117) Amends the Bankruptcy Code to authorize court injunctions requiring that claims and demands for payment be presented solely to a court-approved trust or other vehicle established for claim settlements.
(Sec. 118) Amends the Judiciary Code to prescribe guidelines under which the Judicial Conference may recommend the appointment of a lesser number of bankruptcy judges than is needed.
Title II: Commercial Issues in Bankruptcy - Amends Federal bankruptcy law to provide that in the case of a small business debtor, the court may order, upon request of a party in interest, that a committee of creditors not be appointed. Prescribes guidelines for a small business debtor to: (1) file a Chapter 11 Reorganization plan; and (2) comply with Chapter 11 post petition disclosure and solicitation requirements.
(Sec. 202) Sets forth automatic stay guidelines regarding proceedings against a debtor's single asset real estate.
(Sec. 203) States that the right of a party with a security interest in certain aircraft equipment, maritime vessels, or railroad rolling stock equipment to take possession of such equipment or vessels in compliance with an equipment security agreement is not affected by the automatic stay or property use or sale provisions of the bankruptcy code or by any injunctive power of the bankruptcy court, except in specific circumstances.
(Sec. 204) Requires a trustee, under Chapter 11, to perform the debtor's obligations which arise pursuant to an order for relief under an unexpired lease of personal property until the lease is assumed or rejected.
(Sec. 205) Sets forth or revises guidelines with respect to: (1) the protection of assignees of executory contracts and unexpired leases approved by court order in cases reversed on appeal (exempting from those guidelines executory contracts or unexpired leases relating to real property in a shopping center); (2) the protection of security interests in post-petition rents; (3) the withholding of post-petition debtor's income for certain retirement plan loan repayments; (4) indenture trustee compensation; (5) return of goods; (6) a debtor's interests in the proceeds of money order agreements; (7) liability limitations with respect to noninsider transferees for avoided transfers; (8) executory contracts for airport gate leases; (9) maintenance and continued perfection of a secured creditor's position; (10) nondischargeability of loans to pay nondischargeable taxes; (11) supplemental injunctions; (12) rejection of unexpired leases of real property or timeshare interests; (13) modification of the rights of holders of secured claims in the reorganization plans of small business debtors; (14) inclusion of the claims of independent sales representatives within priority claims against the bankrupt estate; and (15) exclusion from the bankrupt estate of the debtor's interest in liquid or gaseous hydrocarbons.
Title III: Consumer Bankruptcy Issues - Permits a Chapter 13 debtor to cure a home mortgage default on his or her principal residence before its foreclosure sale.
(Sec. 302) Declares certain criminal fines nondischargeable under a Chapter 13 proceeding.
(Sec. 303) Amends Federal bankruptcy law to modify the guidelines under which a lien shall be considered to impair an exemption.
(Sec. 304) Provides that a petition in bankruptcy does not operate as an automatic stay with respect to an action or proceeding for: (1) the establishment of paternity; or (2) the establishment or modification of an order for child or spousal maintenance or support.
Includes within the priority list of expenses and claims that are to be paid by the bankrupt estate any claims for child or spousal support pursuant to a court order. Declares that a debtor in bankruptcy may not avoid a judicial lien securing a debt for child and spousal support or maintenance. Prohibits a bankruptcy trustee from avoiding a transfer that was a bona fide payment of a debt for child or spousal support or maintenance pursuant to a court order. Permits child support creditors to appear and intervene without charge, and without meeting any special local court requirement for attorney appearances, in any bankruptcy proceeding in any bankruptcy or district court upon the filing of a court form detailing the status of the child support debt.
(Sec. 305) Sets forth civil penalties for the negligent or fraudulent preparation of bankruptcy petitions by bankruptcy petition preparers for compensation.
(Sec. 307) Declares that a trustee's plan may not modify the claim of a person holding a primary or a junior security interest in real property or a manufactured home that is the debtor's principal residence, except a junior security interest claim where the interest was undersecured at the time it attached (to the extent that it remains undersecured).
(Sec. 308) Sets forth additional conditions on the ability of a creditor to seek satisfaction of a debt from a codebtor or a debt stayed under Chapter 13.
(Sec. 309) Qualifies antiques as exemptable household goods.
(Sec. 310) Specifies guidelines for the award by a bankruptcy court of professional fees for certain bankruptcy-related services.
(Sec. 311) Mandates that mortgage instruments specifically state whether arrearages on the loan are subject to interest payments (thus placing the mortgagor on notice).
(Sec. 312) States that an individual debtor is not discharged from debts for condominium or cooperative association housing fees.
(Sec. 313) Cites circumstances under which a debtor may not avoid the fixing of a lien on certain tools, implements of trade, animals, and crops.
(Sec. 315) Prescribes guidelines for the conversion of a Chapter 13 case to another Chapter.
(Sec. 316) Treats rent-to-own contracts (leases of durable goods) as secured purchase contracts with respect to: (1) the liquidation; and (2) individual debtor's estates.
Title IV: Bankruptcy Review Commission - National Bankruptcy Review Commission Act - Establishes the National Bankruptcy Review Commission to investigate and report to the Congress, the Chief Justice, and the President on issues relating to business bankruptcies. Authorizes appropriations.
Title V: Bankruptcy Fraud - Amends Federal criminal law to set original penalties for specified fraudulent activities perpetrated in connection with bankruptcy proceedings.
Title VI: Technical Corrections - Makes technical and conforming corrections to the Bankruptcy Code.
Title VII: Severability; Effective Date; Application of Amendments - Sets forth the effective date of this Act. Makes it inapplicable to bankruptcy cases commenced before its enactment.
Title VIII: Miscellaneous Provisions - Prohibits a State from imposing income taxes upon the qualified pension income of an individual who is not a resident or domiciliary of that State.
(Sec. 802) Amends Federal bankruptcy law to proscribe discriminatory treatment of student loan applicants who have been debtors under its aegis.
Expresses the sense of the Senate that it fully endorses specified guidelines presented by the Attorney General to the President which grant Federal assistance to public housing officials to reduce violent crime in public housing projects.