Corona & Nepote

How many times can a debtor file a petition in bankruptcy in the reorganization stage (Chapter 11)? What is the time between the approval of the plan and the second petition (Chapter 22)? In Mexico, once the plan's approval concludes the case, the debtor can file a new petition in bankruptcy in the reorganization stage at any time. The default of a previously approved reorganization plan (Chapter 11) does not produce the immediate opening of the liquidation stage or disapproval of the reorganization plan submitted in the new case (Chapter 22). The breach of a previously approved reorganization plan is both an act of bankruptcy [1] and a fact to consider for the reorganization officer when determining whether to request the early termination of the reorganization stage. [2] Famous cases of Chapter 22 in Mexico are: ·        Grupo Iusacell, S.A. de C.V. (wireless company) o    The first case was tried by the 7 th District Court of Mexico ...

For clarity on this topic, we will explain the priority regime in different scenarios. In the first scenario, there are no secured or specially privileged creditors. In this scenario, claims against the estate are seniors to the rest of the creditors. Within the claims against the estate, labor claims against the estate have priority, followed by the post-petition financial transactions, [1] the claims derived from security, repair, conservation, and administration of goods, and finally, those derived from judicial expenses. After the claims against the estate, there are the singularly privileged creditors, within which debtor’s burial costs are ranked first, and then illness expenses. The singularly privileged creditors are followed by the tax creditors and other labor creditors. After the tax creditors and other labor creditors, the general unsecured creditors and the subordinated creditors are positioned. The second scenario has secured creditors. The rules applicable to the fi...

  A debtor may file a petition to be adjudicated in bankruptcy in three ways: the ordinary petition, the prepackage petition, and the imminent general default petition. Bankruptcy adjudication is not automatic, and even in voluntary petitions, a prebankruptcy procedure needs to be initiated before the bankruptcy adjudication. In the prebankruptcy, the parties will submit evidence to prove whether the debtor is in general default. It is not sufficient that the debtor merely confesses a general default to the court. However, there is no need for a prebankruptcy procedure in case of a prepackage petition, and the judge will immediately adjudicate the debtor in bankruptcy. The prepackage petition must be signed by the debtor and the creditors representing at least the simple majority of the total liabilities stating, under oath, that the debtor is in general default. Besides avoiding the prebankruptcy procedure, there is no other utility of the prepackage petition because: - ...

Bankruptcy adjudication is not automatic, and even in voluntary petitions, a prebankruptcy procedure needs to be initiated before the bankruptcy adjudication. In the prebankruptcy, the parties will submit evidence to prove whether the debtor is in general default. It is not sufficient that the debtor merely confesses a general default to the court. There have been cases in Mexico where the debtor must walk through a long path to get the petition's admission, even in voluntary petitions. This is the case of Minera del Norte, S.A. de C.V., a Mexican mining company, which filed a petition in bankruptcy on May 11, 2020, dismissed three days later on the grounds that the financial statements were not signed. The debtor filed a motion for reconsideration before the bankruptcy court, and the dismissal was affirmed on May 28, 2020. The debtor, then, on June 22, 2020, filed an amparo lawsuit (an extraordinary judicial recourse) before a Federal High Court, which on February 12, 2021, ...

  Hernán Cortés was not the first Spaniard to step into what is now Mexico. Others did it before, some of them remained stranded, and the rest went back to Cuba and informed about a great amount of gold. The governor of Cuba commanded Cortés to explore the new territory, rescue the stranders and collect gold, but nothing regarding conquering. [1] Along with Cortés, other soldiers joined the Spanish armada, with their own effects (weapons, horses, medicines), usually bought at an increased price and on credit with usury interest rates. The soldiers' creditors and sellers relied on the promised gold that the soldiers could collect in the new land. Once Cortés arrived in Mexico, he disobeyed the Cuban governor's orders, founded a new municipality called Veracruz, and received from it, on behalf and representation of the King of Spain, the authorization to conquer Mexico. When the Mexican empire fell, Cortés carried out the collection of gold. The collected amount was not wha...

  During the first trimester of 2021, 5 petitions in bankruptcy were filed, notified, and registered on the Federal Insolvency Institute's records. [1]   Dentix Mexico Health, S.C. (Dentix).           Dentix, a Mexican subsidiary of a Spanish holding, filed a voluntary petition in bankruptcy on December 28 th , 2020. This is an interesting case, provided that Dentix is not a merchant debtor under the Mexican Bankruptcy Law. Not being a merchant debtor is sufficient to dismiss the petition in limine , yet the petition was not dismissed. However, the court can still deny the adjudication in bankruptcy once the pre-bankruptcy procedure is finalized.   Financiamiento Progresemos, S.A. de C.V., SOFOM E.N.R. (Progresemos).           Progresemos , an unregulated financial company that grants micro-loans, filed a voluntary bankruptcy petition on January 6 th , 2021. According t...