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Simple English definitions for legal terms
procedural consolidation
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A quick definition of procedural consolidation:
Procedural consolidation is when two or more bankruptcy cases that involve related debtors are managed under one docket to handle administrative matters more efficiently. This includes notifying creditors and concluding the cases faster. The bankruptcy court can order joint administration when there are cases involving a husband and wife, business partners, or a business and an affiliate. The goal is to increase administrative efficiency without affecting the rights of creditors. This is also known as procedural consolidation.
A more thorough explanation:
Procedural consolidation is a legal term used in bankruptcy cases. It refers to the management of two or more bankruptcy estates, usually involving related debtors, under one docket for the purpose of handling various administrative matters. This is done to conclude the cases more efficiently.
For example, if a husband and wife file for bankruptcy separately, the court may order a joint administration to handle administrative matters such as notices to creditors. This can help to increase the efficiency of administering the two cases without affecting the substantive rights of creditors.
Another example is when two or more business partners file for bankruptcy. In this case, the court may order a joint administration to handle administrative matters related to both cases.
Overall, procedural consolidation is a way to streamline the bankruptcy process and make it more efficient for all parties involved.