The Bankruptcy Abuse Prevention and Consumer Protection Act The Bankruptcy Reform Act of 2005 Seminar August 26, 2005. (Click to read)
Preparing a chapter 11 case is already is already an arduous and fast passed undertaking that can test the mettle of even the most fluent of multitasks. In the aggregate, the new Code will make first–day planning even more challenging for debtor and counsel alike, especially if time-sensitive or big-dollar KERP, utilities or consumer date issues present themselves. As painful as it may be, however, practitioners entrenched in first day forms of the past should heed the measurable breadth of the changes to the Code and start familiarizing themselves with the new provisions discussed above sooner rather than later.
Fortunately, Congress has rejected these attempts to limit your right to file bankruptcy. However, with the 2004 elections, and the strengthening of the Senate's Republican, pro-business majority, the chances of a bill getting approved is now much more likely. In fact, one such bill has already passed the Senate, and congressional experts believe that the House will pass the bill shortly, and that President Bush (who has previously expressed his support for the legislation) will sign it into law.
Means testing is the heart of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. It provides a very detailed formula for determining when abuse arises in the case of an individual debtor with primarily consumer debts.
The amendments to of the Bankruptcy Code substantially modify the provisions of the current law with the respect to cases on or after its effective date, Oct. 17, 2005. The old presumption that the debtor is entitled to relief under chapter 7 except upon a showing of “substantial abuse” will be discarded and replaced by a presumption of abuse through means testing. In addition to the introduction of means testing, the new law will allow a debtor to convert his or her case to chapter 11 or 13 as an alternative to having the case dismissed.
The Bankruptcy Abuse Prevention and Consumer Protection Act The Bankruptcy Reform Act of 2005 Seminar August 26, 2005.