the Coming Crisis – Part Iv

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Pension Plans And The Detroit Bankruptcy    This is Part IV in the series on Pension Plans And The Detroit Bankruptcy: The Coming Crisis. Please refer to the prior articles in the series for context. Another possible victim of the bankruptcy plan offered by the city of Detroit is its treatment of individuals with lawsuits against the city. Jessie Payne, a 72 year old Detroit resident. Ms Payne was making her way to a doctors appointment when a Detroit city bus plowed her over, causing Read More +

the Coming Crisis – Part Iii

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Pension Plans And The Detroit Municipal Bankruptcy Please read the preceding articles of this series on pensions plans and the Detroit municipal bankruptcy to gain a better context and understanding of this article.    The plan proposed by the city of Detroit in its municipal bankruptcy in late July of 2014, was accepted by approximately 82% of the Police and Fire Retirement System and by about 73% of the General Retirement System retirees and current Detroit employees. The majority of bondholders disapproved of the bankruptcy Read More +

the Coming Crisis – Part Ii

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Pension Plans And The Detroit Municipal Bankruptcy Please read Part I of this series on Pension Plans and Municipal Bankruptcy to gain a better context for this and the following blog articles on Municipal Bankruptcy, Detroit, and the coming crisis in governmental pension plans.    According to the Chicago Tribune, the City of Detroit proposed a plan to US Bankruptcy Judge Steven Rhodes, in Detroit, that would adjust the approximately 18 billion dollars in debt acquired by the city. The debt acquired by the City Read More +

the Coming Crisis – Part I

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Pension Plans And Municipal Bankruptcy    Detroit is in Bankruptcy. Detroit is Bankrupt. As of the date of this article, August 19, 2014, Detroit is the debtor in a municipal bankruptcy. Not only individuals or persons, or corporations, can file Bankruptcy. Cities can also file bankruptcy, and seek its benefits and protections. A major issue in the Detroit Bankruptcy, and a major reason for its bankruptcy, is the pension benefits and medical benefits promised to the civil servants of Detroit, both present and retired. Those Read More +

the History of Debtors Prisons and Why It is Important to You (2 of 3)

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Debtor Prisons In United States Today In the United States, although there are no Debtors Prisons specifically, a debtor can be imprisoned in numerous circumstances under criminal penalties which are usually imposed monetarily, but for which the debtor is unable to pay. For example, persons can be found in Contempt of Court and imprisoned after nonpayment of garnishments, confiscations, fines, back taxes and child support. Such penalties are framed as Contempt of Court, the rationale given is obstruction, fraud or negligent nonpayment. Many debtors are Read More +

the History of Debtors’ Prisons and Why It is Important to You (part 1 of 3)

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Debtors’ prisons have existed for many centuries on this planet, and in fact, many forms of bonded servitude and slavery still exist today. Bonded servitude is practiced in India, and other nations, and slavery in its most brutal forms, is practiced in various parts of Africa. Debtors’ prisons are facilities where persons are imprisoned who are unwilling or unable to pay their debts. Bankruptcy Laws were eventually formulated and enacted in order to betray the harsh penalties imposed upon the populace, usually upon the most Read More +

Origins of Bankruptcy Law in the United States

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The United States Constitution gives Congress the power to establish laws on the subject of Bankruptcy throughout the United States. Congress first exercised this power the Bankruptcy Act of 1800. This act, which virtually copied the existing English law, provided for involuntary bankruptcies and was only available to traders (merchants). The act was repealed three years later in 1803. Two more short-lived federal bankruptcy laws were enacted from 1841 to 1843 and from 1867 to 1878. A permanent federal bankruptcy law would not go into Read More +

Bankruptcy in England

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Bankruptcy law in England was once quite harsh. Bankruptcy was considered a crime and people who could not pay their debts were thrown into debtors’ prison or had their ears cut off. In fact, the first legislation dealing with bankruptcy in England was the Statute of the Bankrupts in 1542. One purpose of this law was to prevent people who owed money from escaping England. Only creditors could commence a bankruptcy proceeding. This law aided in the collection of debts and did not provide relief Read More +

Bankruptcy in the Ancient World

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Bankruptcy is a concept that did not always exist. For instance, in Ancient Greece there were no bankruptcy laws. If a person was unable to pay his debts, the person, as well as his immediate family, would be forced into slavery until the debt was worked off. Like the Ancient Greeks, the first known laws of the Ancient Romans punished those who could not pay their debts harshly. If a person could not pay an acknowledged debt then that person could be cut into pieces, Read More +

Chapter 13 Case Permits Cramdown of Mortgages

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Debtors In Bankruptcy in Tampa Area May Pay Only The Actual Value Of Their Homestead In Bankruptcy Provided Their Mortgage Terminates Before Five Years The 11th Circuit of the United States Court Of Appeals Ruled in American General Finance versus Richard W Paschen that the plain language of the Bankruptcy Code allows Debtors in Chapter 13 Bankruptcy to pay only the Secured Value or Fair Market Value of their Residential Property through the Chapter 13 Plan. The Unsecured portion of the Mortgage, which is the Read More +