Bankruptcy Judge Robert E. Ginsberg (N.D. Ill.) succeeds former
Congressman Mike Synar, who resigned December 19, 1995. Synar died in
January 1996, following a long illness.
Q: When was the National Bankruptcy Review Commission formed, and what
is its mandate?
A: The National Bankruptcy Review Commission was created by the
Bankruptcy Reform Act of 1994. All commission members were appointed by
January of 1995, funding was received in July of 1995, and the first
meeting was held on October 20, 1995.
The charge to the commission is to (1) investigate and study issues and
problems relating to the bankruptcy code; (2) evaluate the advisability
of proposals and current arguments with respect to such issues and
problems; (3) prepare and submit a report; and (4) solicit divergent
views of all parties concerned with the operation of the bankruptcy
Q: How is the commission structured, and what special areas of expertise
or interest do its commissioners bring to the commission?
A: There are nine commissioners, all appointed for the life of the
commission. Three members were appointed by the President, one each
appointed by the majority and minority leaders of the House and Senate,
and two were appointed by the Chief Justice.
The President also designates the commission chair and he selected
former Oklahoma Congressman Mike Synar. Synar, who had been active in
virtually every change in bankruptcy law since the Bankruptcy Reform Act
of 1978, passed away in early January of 1996, after a 6-month fight
with brain cancer. As with every project he ever undertook, Mike Synar
led the commission with dignity and principle, and we shall miss him
tremendously, both as a leader and a friend.
President Clinton also appointed Babette A. Ceccotti, a New York
attorney specializing in labor and pension law and bankruptcy, and Jay
Alix, a CPA and turnaround management specialist based in Michigan, the
only non-lawyer on the Commission. Former Senate Majority Leader George
Mitchell appointed Jeffrey J. Hartley, who had worked closely with
Senator Howell T. Heflin on bankruptcy legislation for a number of
years. Senator Bob Dole, then Senate Minority Leader, named James I.
Shepard, a bankruptcy and insolvency tax consultant. Former House
Minority Leader Robert H. Michel chose M. Caldwell Butler, a former
congressman from Virginia who was very active in the 1978 Bankruptcy
Reform Act, and who went into bankruptcy practice after leaving
Congress. Former Speaker of the House Thomas Foley appointed John A.
Gose, a Seattle attorney specializing in real estate and bankruptcy
litigation. Chief Justice Rehnquist appointed Judge Edith H. Jones (5th
Cir.). Judge Jones had an active bankruptcy practice for several years
before being appointed to the federal bench. I was also appointed by the
Chief Justice, and Synar asked me to serve as vice-chair, an appointment
that was ratified by the commissioners at their first meeting. When
Synar resigned from the commission shortly before he died, I became
acting chair, and I will continue to serve in that capacity until the
President designates a permanent chair.
In addition, Synar appointed and the commission confirmed Elizabeth
Warren, who is the Leo Gottlieb Professor of Law at Harvard Law School,
as the chief reporter of the commission. Based in the commis-sion's
Washington, D.C., office, Jarilyn Dupont is the executive director and
general counsel of the commission, working with a deputy counsel and
Q: The National Bankruptcy Reform Act of 1994 was one of the most
sweeping pieces of bankruptcy legislation in the last 15 years. What
areas of bankruptcy will the commission focus on in the immediate
future, and how will these areas be determined?
A: At its November 1995 meeting, the commission identified six general
areas to investigate. Each will be the substantive focus of a meeting
where the commission will invite participants with expertise in the area
to speak. These areas are (1) bankruptcy administration; (2) consumer
bankruptcy; (3) environmental issues, tax, banking, insurance, regulated
industries, future claims, mass torts, Chapter 9; (4) employees, labor,
pensions; (5) business bankruptcy, partnerships, transnational; and (6)
who can be a debtor; the role of bankruptcy, and bankruptcy as
commercial law. Of course, these identified areas are quite broad and
the commission cannot hope to address all elements of each.
The first topic addressed by the commission was bankruptcy
administration, and this was the focus of a meeting on February 23,
1995, in Washington, D.C. The commission will then turn to the subject
of consumer bankruptcy.
Q: Do you anticipate the commission's role as fine-tuning or as
overhauling the bankruptcy system?
A: Minor tinkering with the provisions of the bankruptcy code is
something that is addressed through the technical amendments bill that
currently is moving through Congress. While the commission has not made
a definitive statement on this matter, the work plan that the commission
has laid out thus far indicates the propensity to take more of a macro
approach. Synar was of the view that Congress' charge invited the
commission to take a broad approach, looking, inter alia, into how the
bankruptcy code impacts the domestic economy and how it affects the role
of the United States in the world economy.
Q: The National Bankruptcy Commission has been tasked by Congress with
soliciting divergent views on the operation of the bankruptcy system.
How will the commission accomplish this task?
A: The commission tries to maintain an active presence in the bankruptcy
community so that it can solicit the views of as many parties as
possible. To this end, it held a public hearing in conjunction with the
National Conference of Bankruptcy Judges on November 1, 1995. In
addition, members of the commission have attended dozens of meetings of
other groups to report on progress and to exchange ideas. The
commission's chief reporter, with commission staff, is putting together
teams of experts to make submissions at the public hearings and is
soliciting the view of those in academia. The commission welcomes
comments and suggestions from the public. Correspondence can be sent to
the commission's office at One Columbus Circle, N.E., Suite G-350,
Washington, D.C. 20002, or to commissioners directly. The commission
also can be reached via e-mail at [email protected]
Q: Congress has formed similar commissions in the past, and Congress
continues to carefully examine the bankruptcy laws. Why is changing the
bankruptcy system so important?
A: Approximately one million bankruptcy cases are filed each year,
involving billions of dollars of debt. All commercial transactions are
structured with bankruptcy implications in mind. To this end, the
bankruptcy system should provide predictability as well as economically
efficient structures for dealing with the consequences of financial
failure of various types of enterprises. The reach and effect of
bankruptcy is almost without limit when one considers the Orange County
municipal bankruptcy, mass tort cases, and airline bankruptcies, among
others. Likewise, in consumer cases, the bankruptcy code must balance
the rights of debtors and creditors in far reaching ways. For example,
the Bankruptcy Reform Act of 1994 overhauled family law in such a way to
strengthen perceived family values in the bankruptcy context-at the
expense of the debtor's fresh start. Therefore, Congress has a strong
interest in creating and maintaining a workable bankruptcy system
from The Third Branch, February 1996
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