4.8 Conversions

• Library: Bankruptcy Practice in Virginia (Virginia CLE) (2017 Ed.)

4.8 CONVERSIONS

4.801 Proceeding Converted from Chapter 11 to Chapter 7.

A. In General. The Bankruptcy Code does not clearly address the effect of converting a Chapter 11 case with a confirmed plan to Chapter 7, and courts deciding whether property vests in the debtor or the estate post-conversion have reached differing results. ²⁰⁷ Some courts hold that property vests in the debtor post-conversion by virtue of section 1141(b), which provides that confirmation of a plan vests all of the property of the estate in the debtor. ²⁰⁸ Other courts hold that the property revests in the estate post-conversion because section 1112(b), which allows for conversion of a Chapter 11 case to Chapter 7, would be meaningless if the result of conversion was an estate with no property. ²⁰⁹ Still other courts look to the language and purpose of the debtor's plan to determine whether the parties to the plan intended

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property to...