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LSDefine

Simple English definitions for legal terms

subordination

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A quick definition of subordination:

Subordination is when one person or company's rights or claims are ranked lower than others. This is important when dealing with debts and creditors. Sometimes, a creditor may agree to put their claim on hold to help another creditor get paid first. This is called a contractual subordination agreement. It's like taking turns in line. Subordination is used to make sure everyone gets a fair share of what they are owed, especially in situations like bankruptcy. It's not about punishing anyone, but making sure things are fair for everyone involved.

A more thorough explanation:

Subordination is a legal process where one person or creditor's rights or claims are ranked below those of others. This is important when dealing with the distribution of debts between creditors.

For example, let's say a company owes money to two creditors. One creditor has a higher priority claim than the other. This means that if the company goes bankrupt, the higher priority creditor will get paid first. The lower priority creditor will only get paid if there is any money left over after the higher priority creditor has been paid.

A contractual subordination agreement is a legal agreement where one creditor agrees to give up their priority claim in favor of another creditor. This is enforceable in bankruptcy court.

Subordination is used to prevent unfairness in bankruptcy situations. For example, if a shareholder of a company is also a creditor, they may try to get paid before other creditors. This is not fair to the other creditors. Equitable subordination protects unaffiliated creditors against this type of behavior.

Subordination is not a punishment for wrongdoing. It is a way for the bankruptcy court to make sure that all creditors are treated fairly.

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18:49
thank you my little crow friend
Dkk
18:50
Med law easy done
medicine is a scam
join the ethically ambiguous legal field instead
Dkk
18:57
I want to meet an attorney that defends clients who run into flat earth problems. I want an attorney that knows and believes in flat earth theory.
19:05
i want a flat earther for president. i want a guy who posts on 4chan for president. i want someone who mogs for president.
Dkk
19:18
Exactly. My version of that awful poem.
Dkk
19:19
I can accept a president with maybe one or two of the poems traits hut good God, all of them??? No ty.
windyMagician
19:20
president who respects sex is crazy
windyMagician
19:20
we had bill clinton already
Dkk
19:21
Bill Clinton, first and last black president
windyMagician
19:23
I want to go running but my leg feels weird
windyMagician
19:23
it doesn't hurt its just tingly
Dkk
19:26
It needs more alcohol. You tingle when your nerves need watering.
19:27
try stretching it maybe to see what's up
windyMagician
19:27
stretches make me think it's just soreness
windyMagician
19:27
I'm sober lol
Dkk
19:38
Anyone else get the google notification that your LSD password has been compromised lol. LSD got hacked.
20:48
what.jpg @Dkk
CynicalOops
21:03
You think you just fell out of a coconut tree?
jackfrost11770
21:10
nope dk
CynicalOops
22:37
Calvinamala Harris
jackfrost11770
23:16
should i start using letterboxed again
Dkk
23:25
@jackfrost11770: if you want but like it aint for me
dk do u ever eat at bk
Dkk
23:48
@chickenburgahfart: I would do that in the Army if really desperate for food or if I had to work through lunch. One of the few fast food places I go to.
bk so slept on
Dkk
0:23
I will take In N Out everyday over it when I can though.
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