Opinion ID: 472139
Heading Depth: 3
Heading Rank: 2

Heading: Committee Hearings.

Text: 63 The Commission's draft legislation and alternative legislation drafted by the National Conference of Bankruptcy Judges were introduced in 1973 and 1974 and reintroduced in 1975. 22 Congress held extensive hearings on the draft legislation throughout 1975 and 1976. See Bankruptcy Act Revision: Hearings on H.R. 31 and H.R. 32 before the Subcomm. on Civil and Constitutional Rights, House Comm. on the Judiciary, 94th Cong., 2d Sess. (1976) [hereinafter cited as House Hearings ]; Hearings on S. 235 and S. 236 before the Subcomm. on Improvements in Judicial Machinery, Senate Comm. on the Judiciary, 94th Cong., 1st Sess. (1975) [hereinafter cited as Senate Hearings ]. 64 Numerous witnesses for secured creditors testified on the proposed legislation. 23 Insofar as the automatic stay provision was concerned, nearly all witnesses, including those representing secured creditors, favored retention of the Commission's provision in substance. 24 Numerous witnesses did suggest certain changes to address two concerns: (1) delay in reorganization proceedings, and (2) the danger of consumption of collateral, particularly soft collateral. For example, several witnesses advocated speed and flexibility in the reorganization process so that the proceedings could be concluded in a matter of months rather than years. House Hearings, supra, at 437. 25 Further, several contended that the Commission proposal did not adequately protect creditors against a decline in value of the collateral, particularly soft or self-liquidating collateral such as cash, accounts receivable, chattel paper, contract rights, and inventory. 26 Several witnesses supported the Commission's general proposal to codify the common law standard protecting against depreciation during the stay, but suggested that various examples of how to provide protection to the secured creditor, which the Commission had set forth in its Comments, be codified. 27 65 The simple fact is that in thirty-five days of in-depth hearings before the House subcommittee resulting in over 2700 pages of testimony from more than 100 witnesses, as well as in Senate hearings that were nearly as extensive, the subject of periodic postpetition interest payments for undersecured creditors was not raised in the testimony or prepared statement of a single witness. 28 Not one of the many witnesses for secured creditors even mentioned the award of postpetition interest payments or sought compensation for the delay required by the stay. Viewed in this context, it seems unlikely that Congress intended the adequate protection provisions to require periodic payment of postpetition interest to an undersecured creditor. 66