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I apologise to blog readers on the recent hiatus on posts. I have been away gathering evidence on the efficacy of Chapter 11 following my recent posts on the issue. On Tuesday 31st March 2009 Judge Stuart M. Bernstein gave a lecture at Fordham University Law School entitled: "Is Chapter 11 Dead?" The lecture was trailed in the New York Times in the following manner:
"In the ancient world, insolvent individuals - also known as bankrupts - had no recourse but to sell their families into slavery until creditor's losses were recouped. While this smacks of barbarism, it had a singular advantage: lawyers were not involved."
There are two issues with this introduction. First, it is extremely doubtful that the term bankruptcy was deployed in the classical world. Secondly, it is an anathema to view classical practice of 'smacking of barbarism.' As Professor Maitland observed, we should never judge law or history backwards. We might think selling a family is barbarous, but whether the Greeks or Romans thought the same was true is of course another matter. Judge Bernstein concluded his lecture by stating that Chapter 11 was not dead. He said, inter alia, "Chapter 11 provides a lot of tools to a debtor to streamline its operations, and get rid of unproductive assets..."
"This is the ultimate statement of where the law on IVAs is to be found in our great common law...