Research On Equitable Subordination Rules In The Course Of Bankruptcy Distribution

My thesis focuses on the subject of equitable subordination rule during the course of bankruptcy distribution, which means, while distributing bankruptcy properties, whether and under what circumstances, certain claims shall be subordinatedto other claimsfor the need of justice.Based on available literatures,this thesis classifiesthe legislative patterns on the matter of equitable subordination into two categories:the first category includes the subordination rules apply in the state where the claimant acted inequitably, and the second category includes the subordination rules apply in the state ofstrategic loans. By comparison, subordination rules regulating strategic loans are more welcome in the worldwide, andsubordination rule regulating equitable conducts can only be found in the United States.It'll be interesting if we look into the recent development of different legislations on the matter of equitable subordination rules.On one hand, most country model their equitable subordination rules on German's pattern, ie, strategic loan issues by a shareholderat the time of crisis shall be subordinated to other creditors when participating the bankruptcy distribution.on the other hand,in the mailand and taiwan, most scholars choose to follow the United States' pattern whileenacting equitable subornation rules, ie, ifthe claimant act inequitably, then its claim shall be subordinated to other creditors when participating the bankruptcy distribution.Taking the civil law tradition into account, one may wonder while introducing the equitable subordination rules, why the PRC refuses to follow the German's pattern but pursueto model herself on the United States' pattern, does it means the United States' patternsuited better the concrete situation in our country?No sound conclusion can be drawn,because no comparison has been made.There lacks a systematic analytic framework in the current comparative studies on the equitable subordination rules. And this has resulted in the ignorance of severaltypicallegislations,such as the "Doctrine of Debt Recharacterization" in the United States, "Qualified De Facto Group" and "Liability for Causing the Company's Insolvency" in Germany, and that some misleading conclusions have been reached.Given due attention to the above deficiency, this thesis aims to set up a complete analytic framework on the matter of equitable subordination rules, and fill the gaps in current research, follow the recent development of important legislations, review the necessity and rationality of introducing the two separate equitable subordination rules into our jurisprudence,and put forward some preliminary advices on the transplantation. Concretely speaking, besides the introduction and conclusion, this thesis is divided into four chapters as follows:In the first chapter, I put forward a theoretical framework for further research.The key point of this framework is toclassify theequitable subordination rules in different legislations into Rules regulating strategic loans and Rules regulating inequitable conducts.In the second chapter, I introduceequitable subordination rules regulating inequitable conducts by taking the Equitable Subordination Doctrine in American law as instance. I review the emergence and development of the Equitable Subordination Doctrine in American law, clarify its application conditions and legal consequences, and emphasize itsjurisdictional and remedial limits.In the third chapter, I introduce equitable subordination rulesregulating strategic loans by taking Doctrine of Debt Recharacterization in American law and Doctrine of Equity Substitution inGermany law as instances, pointing that there are two types of strategic loans that should be subordinated in the bankruptcy distribution:the ambiguous ones and the substitution ones, which are different in applying conditions but similar in legal consequences. Besides, I also discuss the divergent polices existing among the different legislations on the treatment of strategic loans.In the fourth chapter, based on foregoing analysis, I try to abstractauniform legal logic behind differentequitable subordination rules, and discuss the necessity and rationality of introducing the two separate equitable subordination rules into our jurisprudence,and put forward some preliminary advices on the transplantation.