Lifting The Cloud Of Uncertainty

5 March 2012
New York Law Journal
Section 510(a) of the U.S. Bankruptcy Code provides that a subordination agreement is enforceable to the same extent that it is enforceable under applicable non-bankruptcy law.1 While contractual arrangements relating to priority of payment between creditors are respected in bankruptcy, courts are divided as to whether the waiver of a creditor's right to vote on a Chapter 11 plan should be enforced.