Notes on 11 U.S.C. § 1141 : US Code - Notes

Search Notes on 11 U.S.C. § 1141 : US Code - Notes

    (Pub. L. 95-598, Nov. 6, 1978, 92 Stat. 2638; Pub. L. 98-353, title
    III, Sec. 513, July 10, 1984, 98 Stat. 387; Pub. L. 109-8, title
    III, Secs. 321(d), 330(b), title VII, Sec. 708, Apr. 20, 2005, 119
    Stat. 95, 101, 126; Pub. L. 111-327, Sec. 2(a)(36), Dec. 22, 2010,
    124 Stat. 3561.)



                       HISTORICAL AND REVISION NOTES                   

                          LEGISLATIVE STATEMENTS                      
      Section 1141(d) of the House amendment is derived from a
    comparable provision contained in the Senate amendment. However,
    section 1141(d)(2) of the House amendment is derived from the House
    bill as preferable to the Senate amendment. It is necessary for a
    corporation or partnership undergoing reorganization to be able to
    present its creditors with a fixed list of liabilities upon which
    the creditors or third parties can make intelligent decisions.
    Retaining an exception for discharge with respect to
    nondischargeable taxes would leave an undesirable uncertainty
    surrounding reorganizations that is unacceptable. Section
    1141(d)(3) is derived from the Senate amendment. Section 1141(d)(4)
    is likewise derived from the Senate amendment.

                         SENATE REPORT NO. 95-989                     
      Subsection (a) of this section makes the provisions of a
    confirmed plan binding on the debtor, any entity issuing securities
    under the plan, any entity acquiring property under the plan, and
    any creditor, equity security holder, or general partner in the
    debtor, whether or not the claim or interest of the creditor,
    equity security holder, or partner is impaired under the plan and
    whether or not he has accepted the plan. There are two exceptions,
    enumerated in paragraph (2) and (3) of subsection (d).
      Unless the plan or the order confirming the plan provides
    otherwise, the confirmation of a plan vests all of the property of
    the estate in the debtor and releases it from all claims and
    interests of creditors, equity security holders and general
    partners.
      Subsection (d) contains the discharge for a reorganized debtor.
    Paragraph (1) specifies that the confirmation of a plan discharges
    the debtor from any debt that arose before the date of the order
    for relief unless the plan or the order confirming the plan
    provides otherwise. The discharge is effective against those claims
    whether or not proof of the claim is filed (or deemed filed), and
    whether or not the claim is allowed. The discharge also terminates
    all rights and interests of equity security holders and general
    partners provided for by the plan. The paragraph permits the plan
    or the order confirming the plan to provide otherwise, and excepts
    certain debts from the discharge as provided in paragraphs (2) and
    (3).
      Paragraph (2) of subsection (d) makes clear what taxes remain
    nondischargeable in the case of a corporate debtor emerging from a
    reorganization under chapter 11. Nondischargeable taxes in such a
    reorganization are the priority taxes (under section 507) and tax
    payments which come due during and after the proceeding under a
    deferred or part-payment agreement which the debtor had entered
    into with the tax authority before the bankruptcy proceedings
    began. On the other hand, a corporation which is taken over by its
    creditors through a plan of reorganization will not continue to be
    liable for nonpriority taxes arising from the corporation's
    prepetition fraud, failure to file a return, or failure to file a
    timely return, since the creditors who take over the reorganized
    company should not bear the burden of acts for which the creditors
    were not at fault.
      Paragraph (3) specifies that the debtor is not discharged by the
    confirmation of a plan if the plan is a liquidating plan and if the
    debtor would be denied discharge in a liquidation case under
    section 727. Specifically, if all or substantially all of the
    distribution under the plan is of all or substantially all of the
    property of the estate or the proceeds of it, if the business, if
    any, of the debtor does not continue, and if the debtor would be
    denied a discharge under section 727 (such as if the debtor were
    not an individual or if he had committed an act that would lead to
    a denial of discharge), the chapter 11 discharge is not granted.
      Paragraph (4) authorizes the court to approve a waiver of
    discharge by the debtor.

                          HOUSE REPORT NO. 95-595                      
      Paragraph (2) [of subsec. (d)] makes applicable to an individual
    debtor the general exceptions to discharge that are enumerated in
    section 523(a) of the bankruptcy code.

                                AMENDMENTS                            
      2010 - Subsec. (d)(5)(B)(iii). Pub. L. 111-327, Sec. 2(a)(36)(A),
    added cl. (iii).
      Subsec. (d)(5)(C). Pub. L. 111-327, Sec. 2(a)(36)(B), substituted
    "the court may grant a discharge if," for "unless" in introductory
    provisions and inserted concluding provisions.
      2005 - Subsec. (d)(2). Pub. L. 109-8, Sec. 321(d)(1), substituted
    "A discharge under this chapter does not discharge a debtor who is
    an individual" for "The confirmation of a plan does not discharge
    an individual debtor".
      Subsec. (d)(5). Pub. L. 109-8, Sec. 321(d)(2), added par. (5).
      Subsec. (d)(5)(C). Pub. L. 109-8, Sec. 330(b), added subpar. (C).
      Subsec. (d)(6). Pub. L. 109-8, Sec. 708, added par. (6).
      1984 - Subsec. (a). Pub. L. 98-353, Sec. 513(a), substituted "any
    creditor, equity security holder, or general partner in" for "any
    creditor or equity security holder of, or general partner in,".
      Subsec. (c). Pub. L. 98-353, Sec. 513(b), amended subsec. (c)
    generally. Prior to amendment, subsec. (c) read as follows: "After
    confirmation of a plan, the property dealt with by the plan is free
    and clear of all claims and interests of creditors, of equity
    security holders, and of general partners in the debtor, except as
    otherwise provided in the plan or in the order confirming the
    plan."

                     EFFECTIVE DATE OF 2005 AMENDMENT                 
      Amendments by Pub. L. 109-8 effective 180 days after Apr. 20,
    2005, with amendments by sections 321(d) and 708 of Pub. L. 109-8
    not applicable with respect to cases commenced under this title
    before such effective date, except as otherwise provided, and
    amendment by section 330(b) of Pub. L. 109-8 applicable with
    respect to cases commenced under this title on or after Apr. 20,
    2005, see section 1501 of Pub. L. 109-8, set out as a note under
    section 101 of this title.

                     EFFECTIVE DATE OF 1984 AMENDMENT                 
      Amendment by Pub. L. 98-353 effective with respect to cases filed
    90 days after July 10, 1984, see section 552(a) of Pub. L. 98-353,
    set out as a note under section 101 of this title.