Legal Issues Concerning the Supplementary Filing of Claims in Bankruptcy Reorganization Proceedings

Abstract

The current system for the supplementary filing of claims in bankruptcy reorganization proceedings seeks to protect the lawful rights and interests of creditors who fail to file on time. This accords with one of the purposes of bankruptcy law: protecting creditors’ lawful rights and interests. In light of the legislation and judicial practice, however, the current system raises several legal problems. The conditions for supplementary filing are too permissive; payment to creditors who file late on the same terms as claims of the same class is difficult to implement; and the costs of supplementary filing are unclear. These problems may harm creditors who file on time, upset the balance among interested parties, and hinder the legislative purposes of reorganization. This article examines those problems from the perspective of the values underlying bankruptcy reorganization and offers proposals for improving the supplementary filing system.