Had the federal appellate court ruled that the bankruptcy attorneys had subordination rights (the ability to subordinate the rights of other claimants), what would have happened?

Question

Gates

Social Studies

15 July, 18:23

Had the federal appellate court ruled that the bankruptcy attorneys had subordination rights (the ability to subordinate the rights of other claimants), what would have happened?

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Answers (1)

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Eve Marks · Answer 1

The correct answer is : The tax authorities would have received less money

Explanation:

Let's take into account that subordination adjusts the priority of the new loan and a creditor is placed in a lower priority for the collection of its debt. So, The amount of money that the bankruptcy lawyer could have received would be $200,000. On the other hand, the tax authorities would have received less than that