Rochelle’s Daily Wire posted an interesting article about District Judge Robin L. Rosenberg’s opinion that “two-year delay in confirmation obliged the bankruptcy court as a matter of law to hold another hearing to value a secured creditor’s collateral.”
Here is a snippet of the article: “A chapter 11 debtor filed a motion to value collateral under Section 506(a). Without objection from the lender, the bankruptcy court entered an order finding that the collateral was worth $38,000. The order bifurcated the lender’s claim into secured and unsecured claims “in any plan and disclosure statement filed in this case.” The debtor amended the plan twice. When the confirmation hearing rolled around some two years after the valuation order, the lender objected to the plan’s $38,000 valuation of the collateral. Holding that the valuation order was final and binding, the bankruptcy judge declined to hear testimony from the lender’s expert to show that the collateral had increased in value over the ensuing two years. The lender appealed and won, setting aside confirmation in the process. Judge Rosenberg cited the Collier bankruptcy treatise for the proposition that property should be valued as of the date to which the valuation relates — in this case, the date of confirmation. She therefore said that the bankruptcy court “erred as a matter of law when it assessed whether the confirmation requirements were met by reference to a two-year-old valuation” because the valuation was “stale” for the purpose of deciding whether the plan met Section 1129 confirmation standards.”
The case citation is Deutsche Bank National Trust Co. v. Jackson, 19-81506.
You can read the entire article here.