Chapter 9 - § 9.11 • USE, SALE, OR LEASE OF PROPERTY

• Jurisdiction: Colorado

§ 9.11 • USE, SALE, OR LEASE OF PROPERTY

11 U.S.C. § 363 authorizes a debtor-in-possession or bankruptcy trustee to use, sell, or lease property in the ordinary course of business without court order. Thus, for instance, a retail establishment may continue to sell inventory without court order. (To the extent the inventory is subject to a lien, the debtor may not use cash proceeds (cash collateral) without the secured creditor's consent or court permission.)

Sales outside the ordinary course of business require bankruptcy court approval. 11 U.S.C. § 363(b); In re Dant & Russell, Inc., 853 F.2d 700 (9th Cir. 1988) (discussing standards for determination of whether particular transaction is within ordinary course of business).

A bankruptcy sale may be free and clear of the secured creditor's...