Study On The Repayment Sequence Of The Bankruptcy Claims

The repayment sequence of bankruptcy claims has been one of the important subjects inthe bankruptcy law. It is a main mission of the traditional bankruptcy law to fairly pay theclaims. The reorganization system was accepted by the traditional bankruptcy law, as a rightpearl in the bankruptcy law, because it is established based on the logic conclusion that thereorganization system can save the debtor and make the creditors gain a better repayment. So,how to fairly pay the claims of the creditors is and will have been one of the core subjects inthe bankruptcy law. The bankruptcy claims have been being paid according to a certainsequence since ancient Rome. Then how to establish a fair and reasonable repaymentsequence of bankruptcy claims is also an important issue about the fair repayment ofbankruptcy claims in the bankruptcy law. In fact, the question that how to fairly pay thebankruptcy claims by the debtor’s finite bankrupt property among the creditors when thedebtor is in bankruptcy can be seen as the rights conflict among the creditors. And the factthat the bankruptcy claims are paid in a legal repayment sequence can be seen the solutionmethod of the rights conflict among the creditors. The repayment sequence of bankruptcyclaims can be seen as the rights hierarchy between the various claims under the background ofbankruptcy liquidation. When studying on the repayment and the repayment sequence ofbankruptcy claims, the angle from the angle of the rights conflict and rights hierarchy is animportant angle of study. So this dissertation organizes the writing ideas from the above angleof study during the study on the repayment sequence of bankruptcy claims. This dissertationstarting with an introductory part consists of seven chapters with about200thousand words attotal.The introductory part mainly discusses the important value in studying the repaymentsequence of bankruptcy claims under the background of the reorganization system arising. Inthe traditional bankruptcy law, it is an important system design for the aim to fairly pay thebankruptcy claims that the bankruptcy claims are paid in the legal sequence. Although thereorganization system aims to promote the regeneration of the debtor, and achieve savingenterprise, but the repayment sequence of bankruptcy claims still occupies an importantposition in the bankruptcy law. Firstly, the bankruptcy creditors’ procedural rights, consistingof (including) the rights in the reorganization procedure, are constructed on their claims’position in the repayment sequence. Secondly, the repayment sequence of bankruptcy claims provides the basis on which the creditors’ interests in the reorganization procedure areprotected. It is the bottom line that the reorganization plan draft is accepted by the creditors tomake sure every creditor can gain the repayment as possible as much gain according to therepayment sequence in the bankruptcy law. And it is the basis of the negotiation.Chapter one mainly discusses that the bankruptcy claims are paid in the repaymentsequence as a method to break the equality on creditor’s rights embodies the bankruptcy lawpursuit for the substantial fairness. The emergence and development of the creditor’s rights isthe milestone in the history of the development of the private law. But the exertion of thefunction of the creditor’s rights is based on the repayment of the claims. Gaining therepayment has been the ultimate purpose and significance for the creditor’s rights since itsemergence. Therefore, protecting the creditor’s rights and ensuring the creditor’s rights gainrepayment smoothly have become one of the central tasks of modern civil law. When theindividual execution can’t have very good effect under the background of debtor’s insolvency,the bankruptcy law provides a centralized and unified executive procedure which effectivelyresolves the problem of repayment of the creditor’s rights when the debtor is insolvent.Although the creditor’s rights are equal each other, but the equality can be divided intoformal equality and essential equality. The equality among the creditor’s rights in the civil lawshould be formal equality; but this equality may be broken by the contact or the legislation.The repayment sequence of bankruptcy claims in the bankruptcy law is an important methodto break the equality on creditor’s rights and it embodies the bankruptcy law pursuit for thesubstantial fairness among the creditor’s rights. So the bankruptcy claims are paid in therepayment sequence is an important supplement of the principle of the equality among thecreditor’s rights instead of denying the status of the principle of the equality among thecreditor’s rights. And it effectively prevents the absolute formal equality bringing theessential unequality.The second chapter discusses that the repayment of the bankruptcy claims is essential therights conflict. The legal rights conflict is an objective phenomenon during the process of therights functioning. The utilitarianism and exclusiveness of rights and the fuzziness of therights boundary are all the intrinsic reason of rights conflict. But the rights conflict is not thenormalcy and it arises out of the identity and implications of the rights’ objects under thecertain background. The creditor’s rights as one kind of rights have the gene of the rightsconflict. Because of the equality among the creditor’s rights, the multiple creditors’ rights of the same debtor are equal in establishment and repayment opportunity, and the creditors willcompete on the repayment. Especially, when the debtor is insolvent, the bankruptcy claims ofthe same debtor face the finite bankrupt properties, are repaid by the same method, on thesame time and in the same procedure, the conflict of the bankruptcy claims emergesnecessarily. So, the repayment of the creditors’ rights can be seen the rights conflict amongthe bankruptcy claims because of the object relevance.Chapter three argues that the repayment sequence of the bankruptcy claims can be seenas the legal rights hierarchy. The rights hierarchy arises out of the hierarchy of the rights value,the hierarchy of the interests, the rights systematization, and the hierarchy of the humandemands. The rights hierarchy is substantially unequal between the rights. Although it isimpossible to sort all kinds of rights as the periodic table according to a certain standard, therights hierarchy can be found and stipulated as the very important method to resolve the rightsconflict under the especial background. In the rights hierarchy, the high order rights exertpreferentially and the low order rights exert the latter. This is an effective method to resolvethe rights conflict. Although the bankruptcy claims are all the money rights, their causes andnature are different and the creditors’ situations are various. It is not scientific and reasonableto repay the bankruptcy claims in the simple and single method to resolve the rights conflictamong the bankruptcy claims, and the method is to repay the claims according to the amountproportion. On the contrary, it is substantially fair to repay the bankruptcy claims in the legalrepayment sequence, and this repayment method is stipulated in most of countries’ bankruptcylaw. The repayment sequence of the bankruptcy claims is the rights hierarchy of thebankruptcy claims in the bankruptcy liquidation procedure which is seen as a centralized andunified executive procedure, under the background that the bankruptcy claims are repaid bythe debtor’s finite bankruptcy property.Chapter four, Chapter five and Chapter six are the key contents of this dissertation, andthese three chapters study the establishment of the repay sequence of the bankruptcy claims.The fourth chapter argues that the ascertainment theory of the rights is the baseness toestablish the repay sequence of the bankruptcy claims. The ascertainment of the rightshierarchy is not easy even in a specific scenario. This process is a process of interest measureand value judgment. In this process, the ascertainment of the rights hierarchy needs thinkingabout the nature of rights and social policy goals at that time, and examining by the fairnessand justice. Although the absolute priority does not exist, the following basic conclusions should be approved: firstly, when the right of subsistence collides with the other rights, theright of subsistence is preferred. Secondly, when the personal right collides with the propertyright, the personal right is preferred. Thirdly, the rights involved more the public interests arepreferred. Fourthly, the rights of the weak should be protected preferentially. Fifthly, when thereal right collides with the creditors’ rights, the real right is preferred. Sixthly, the rights withthe weaker risk prevention ability should be protected preferentially.The fifth chapter indicates that the genre analysis of the bankruptcy claims is the premiseto establish the repay sequence of the bankruptcy claims. Consistent with thelegislation model with “one large door and three small doors” of Enterprise Bankruptcy Lawin our country, the concept bankruptcy claim as the property claim which can be enforcedbefore the bankruptcy application is accepted by the court should be used all in thereconciliation, reorganization and liquidation procedures. Type is the state between theabstract and specific, and the research method of typing with the characteristics of abstractand specific is helpful to establish the bridge between the abstract and specific. It is thepremise of establishing the repay sequence of the bankruptcy claims to type the bankruptcyclaims in the research method of typing. This method can distinguish the different bankruptcyclaims and is helpful to deal with the same type of bankruptcy claims in the same standardsand the different types of bankruptcy claims in different standards. This chapter types thebankruptcy claims into the following types: the bankruptcy claims out of consensus, thebankruptcy claims not out of consensus, the bankruptcy claims involving the right tosubsistence, and the bankruptcy claims involving the personal right, and the securedbankruptcy claims, and the bankruptcy claims involving more public interests, and thebankruptcy claims of the weak, and the ordinary bankruptcy claims.Base on the research of Chapter four and Chapter five, the sixth chapter draws theconclusion of the study on the establishment of the repayment sequence of bankruptcy claims:the first conclusion is that the following bankruptcy claims should be repaid prior to theordinary bankruptcy claims: the bankruptcy claims involving the right to subsistence, and thebankruptcy claims involving the personal right, and the secured bankruptcy claims, and thebankruptcy claims involving more public interests, and the bankruptcy claims of the weak; thesecond conclusion is that the bankruptcy claims not out of consensus should be repaid prior tothe bankruptcy claims out of consensus; the third conclusion is that the repayment sequencebetween the bankruptcy priorities is ascertained on the basis of the social policy goals. By contrasting the above research conclusions with the legislation of the repayment sequence ofbankruptcy claims in several representative countries, this chapter finds that the types of thebankruptcy priority in the several representative countries’ bankruptcy laws are consistentwith the above research conclusion. But there is a great difference between the legislation ofthe repayment sequence between the bankruptcy priorities in theseveral representative countries. This is mainly determined by the different social policy goalsin different countries and connects with their economy and society development situation.Chapter seven rethinks the repayment sequence of bankruptcy claims provided inChinese bankruptcy law. Firstly, by contrasting the above research conclusion with theChinese legislation of the repayment sequence of bankruptcy claims, this chapter finds theyare basically consistent. Secondly, based on the above conclusion, by reviewing the types ofthe bankruptcy priority and their repayment grades in the Chinese repayment sequence ofbankruptcy claims, this chapter argues that the Enterprise Bankruptcy Law should maintainthe labor priority and the tax priority, establish the personal tort priority which should havethe same repayment grade with employee claims in the labor claims, maintain the priority ofthe secured claims and provide the claims repaid behind of the ordinary bankruptcy claims.