Administrative Insolvency

Also known as administratively insolvent. The inability of a debtor in bankruptcy to pay its administrative expenses ( www.practicallaw.com/9-382-3217) , such as attorneys' fees and other professional fees. Administrative claims must be paid in full as a condition to confirmation ( www.practicallaw.com/1-382-3358) of a Chapter 11 plan of reorganization ( www.practicallaw.com/9-382-3694) , unless administrative creditors agree to less than full payment. Therefore, administrative insolvency usually results in conversion of the case to a Chapter 7 liquidation ( www.practicallaw.com/9-382-3590) or a dismissal of the case.

{ "siteName" : "PLC", "objType" : "PLC_Doc_C", "objID" : "1247245018038", "objName" : "Administrative Insolvency", "userID" : "2", "objUrl" : "http://us.practicallaw.com/cs/Satellite/us/resource/3-383-9198?null", "pageType" : "Resource", "academicUserID" : "", "contentAccessed" : "true", "analyticsPermCookie" : "2-7d8d9c15:14ef78d4951:34f8", "analyticsSessionCookie" : "2-7d8d9c15:14ef78d4951:34f9", "statisticSensorPath" : "http://analytics.practicallaw.com/sensor/statistic" }