Temple City Bankruptcy Attorney, Bankruptcy Lawyer, Bankruptcy Code 11 USC Section 1174

TITLE 11 - BANKRUPTCY
CHAPTER 11 - REORGANIZATION
    SUBCHAPTER IV - RAILROAD REORGANIZATION

-HEAD-
    Sec. 1174. Liquidation

-STATUTE-
      On request of a party in interest and after notice and a hearing,
    the court may, or, if a plan has not been confirmed under section
    1173 of this title before five years after the date of the order
    for relief, the court shall, order the trustee to cease the
    debtor's operation and to collect and reduce to money all of the
    property of the estate in the same manner as if the case were a
    case under chapter 7 of this title.

-SOURCE-
    (Pub. L. 95-598, Nov. 6, 1978, 92 Stat. 2644.)


                       HISTORICAL AND REVISION NOTES                   

                          LEGISLATIVE STATEMENTS                      
      Section 1174 of the House amendment represents a compromise
    between the House bill and Senate amendment on the issue of
    liquidation of a railroad. The provision permits a party in
    interest at any time to request liquidation. In addition, if a plan
    has not been confirmed under section 1173 of the House amendment
    before 5 years after the date of order for relief, the court must
    order the trustee to cease the debtor's operation and to collect
    and reduce to money all of the property of the estate in the same
    manner as if the case were a case under chapter 7 of title 11. The
    approach differs from the conversion to chapter 7 under section
    1174 of the Senate bill in order to make special provisions
    contained in subchapter IV of chapter 11 applicable to liquidation.
    However, maintaining liquidation in the context of chapter 11 is
    not intended to delay liquidation of the railroad to a different
    extent than if the case were converted to chapter 7.
      Although the House amendment does not adopt provisions contained
    in sections 1170(1), (2), (3), or (5), of the Senate amendment such
    provisions are contained explicitly or implicitly in section 1123
    of the House amendment.

                         SENATE REPORT NO. 95-989                     
      Section 1174 permits the court to convert the case to a
    liquidation under chapter 7 if the court finds that the debtor
    cannot be reorganized, or if various time limits specified in the
    subchapter are not met. Section 77 [section 205 of former title 11]
    does not authorize a liquidation of a railroad under the Bankruptcy
    Act [former title 11]. If the railroad is not reorganizable, the
    only action open to the court is to dismiss the petition, which
    would in all likelihood be followed by a State court receivership,
    with all of its attendant disadvantages. If reorganization is
    impossible, the debtor should be liquidated under the Bankruptcy
    Act.

-End-
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