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The Rights and Risks of Creditors in Lending to Financially Troubled Corporatons: A Canadian Perspective
Author(s) -
Tay Derrick C.
Publication year - 1991
Publication title -
international insolvency review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.125
H-Index - 7
eISSN - 1099-1107
pISSN - 1180-0518
DOI - 10.1111/j.1099-1107.1991.tb00012.x
Subject(s) - debtor , creditor , context (archaeology) , political science , law and economics , property rights , law , humanities , welfare economics , business , sociology , economics , debt , finance , philosophy , geography , archaeology
Creditors who rely on security interests in the property of a financially troubled debtor may discover that their security is vulnerable to legal attack. Examining this problem in the context of Canadian law, the cutrhor identifies both traditional and evolving bases for attack: preferences, froudulent conveyances, limitations on transactions between affiliated entities, oppression. limitations on the right to proceed upon default, and “lender liability.” The author concludes that creditors will be able to assess their risks only if they understand the evolving doctrines. Les créanciers qui šen remettent aux garanties quitl détiennet sur les biens ďun débiteur qui connaît des diffeciltés financières risquent de constater que leur garantie n'est pas inattaquable du point de vue juridique. Examinant ce problème dans le contexte du droit canadien. ľauteur identifie cessions frauduleuses, restrictions aux opéder par défaut, et responsabilité du prêteur. Ľauteur conclut que les créanciers ne seront en mesure ďévalure les risques que s'ils acpuièrent une bonne compréhension des doctrines qui se développent.