INSOL Talks
Ep. 61 - Public Policy in Cross Border Insolvency
Dec 4, 2024
Join Hon. Allan L. Gropper, a former U.S. bankruptcy judge, and Hon. Paul Heath, Chief Justice of the Pitcairn Islands, as they dive into the complexities of the Model Law on Cross-Border Insolvency. They explore the controversial public policy exception and its applications in the U.S., Australia, and New Zealand. Discover key legal interpretations, including the Comey test, and how different jurisdictions navigate procedural fairness. Their insights reveal the ongoing challenges and evolving landscape of international insolvency law.
39:11
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Quick takeaways
- The public policy exception within cross-border insolvency is interpreted narrowly in the U.S., emphasizing procedural fairness in foreign proceedings.
- Australia's and New Zealand's differing approaches to the public policy exception reflect varying judicial thresholds and legislative recommendations for its application.
Deep dives
Public Policy Exception in the U.S. Bankruptcy System
The public policy exception within Chapter 15 of the U.S. Bankruptcy Code has been a critical point of discussion. Early cases evaluated the applicability of this exception concerning actions that contradicted U.S. public policy. However, several appellate court decisions have determined that this exception should be interpreted narrowly, often reserving it for instances where procedural fairness in foreign proceedings is significantly in doubt. For example, a notable case involving a German trustee sought U.S. authorization for an email wiretap, which was deemed to violate not only U.S. criminal law but also established public policy, showcasing the narrow application of the exception.
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