Wolfson Bolton Kochis PLLC attorneys Scott A. Wolfson and Logan T. Grizzell recently published their article, “Equitable Subrogation in Bankruptcy: A Potential Lifeline for Unsecured Creditors” in the American Bar Association Business Law Section’s Business Law Today. The article appears in the ABA’s Bankruptcy & Finance coverage and highlights a practical issue that can materially impact recoveries in Chapter 11 cases.
In the article, Scott and Logan examine how equitable subrogation may offer a powerful, and often overlooked, tool in Chapter 11 to preserve lien rights for the benefit of the bankruptcy estate after a debtor guarantor pays secured debt. The doctrine allows the estate to step into the lender’s shoes, maintaining priority of the debt and collateral and potentially enhancing unsecured creditor recoveries where unsecured creditors are otherwise out of the money under the Bankruptcy Code’s priority scheme.
Their analysis also underscores an important practical takeaway for restructuring professionals: transaction structuring and plan drafting matter. By embedding equitable assignment directly into a confirmed plan, practitioners can transform satisfied secured claims into estate assets, creating a potential lifeline for unsecured creditors.
This publication reflects the firm’s continued focus on providing strategic, technically grounded counsel in bankruptcy, restructuring, and finance matters.
If your business is navigating financial distress, creditor claims, or a restructuring scenario, our team can help evaluate practical options and develop a strategy tailored to your circumstances. Wolfson Bolton Kochis PLLC also regularly represents unsecured creditors’ committees and trade creditors in Chapter 11 cases in Michigan and nationwide.
Read the Article – “Equitable Subrogation in Bankruptcy: A Potential Lifeline for Unsecured Creditors”, published in ABA Business Law Today by Scott A. Wolfson and Logan T. Grizzell.
