Summary:
Following the appointment of a Receiver under the North Carolina Commercial Receivership Act, N.C.G.S. § 507.20 et seq., to conduct an orderly liquidation process of Mafic, the Receiver objected to several proofs of claims. The North Carolina Business Court turned to Bankruptcy Code for guidance regarding the burden of proof necessary to determine the reasonableness or validity of a claim accepted or rejected by a Receiver.
Commentary:
It will be interesting to watch as the North Carolina state courts, particularly the business court, develop a set of practices and a corpus of law interpreting and applying the NCCRA to see whether this leads to more cases of business liquidation being handled in this manner than under the Bankruptcy Code. Whether those developments might lead to a relaxation of, as Chapter 11 attorneys often bemoan in their less guarded moments, how they feel bankruptcy in North Carolina can often be overly punctilious and draconian is an open question. Further, a growing comfort with state court receiverships might lead creditors on the consumer side to also turn there for an effective means of judgment collection.
To read a copy of the transcript, please see:
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