Bankruptcy Reform Act 92 Stat. 2549 (1978)
BANKRUPTCY REFORM ACT 92 Stat. 2549 (1978)
The Bankruptcy Reform Act of 1978 was the first comprehensive revision of federal bankruptcy law since 1938 and the first completely new bankruptcy law since 1898. (See bankruptcy power.) Although the 1978 act made many substantive changes in bankruptcy law, its most controversial changes concern the organization of the bankruptcy system. The act expanded the bankruptcy court's authority to include jurisdiction over virtually all matters relating to the bankrupt and the bankrupt's assets. This expansion, combined with Congress's failure to staff the new bankruptcy courts with life-tenured judges, led the Supreme Court in northern pipeline construction co. v. marathon pipe line co. (1982) to invalidate portions of the act's jurisdictional scheme. (See judicial power of the united states.) In an effort to upgrade the bankruptcy courts, the act, in selected pilot districts, creates a system of United States trustees to administer and supervise bankruptcy cases, leaving courts free to perform more traditional adjudicatory functions. One of the statute's most significant changes is to consolidate into a single reorganization proceeding what had been three different methods for reorganizing financially distressed corporations.
Theodore Eisenberg
(1986)
Bibliography
Selected Articles on the Bankruptcy Reform Act of 1978 1979 St. Mary's Law Journal 11:247–501.