11 U.S.C. § 305

Abstention

Read at: OLRCuscode.house.gov CornellLII GovInfogovinfo.gov JustiaTitle 11 CasesGoogle Scholar

(a) The court, after notice and a hearing, may dismiss a case under this title, or may suspend all proceedings in a case under this title, at any time if—(1) the interests of creditors and the debtor would be better served by such dismissal or suspension; or(2)(A) a petition under section 1515 for recognition of a foreign proceeding has been granted; and(B) the purposes of chapter 15 of this title would be best served by such dismissal or suspension.(b) A foreign representative may seek dismissal or suspension under subsection (a)(2) of this section.(c) An order under subsection (a) of this section dismissing a case or suspending all proceedings in a case, or a decision not so to dismiss or suspend, is not reviewable by appeal or otherwise by the court of appeals under section 158(d), 1291, or 1292 of title 28 or by the Supreme Court of the United States under section 1254 of title 28.(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2561; Pub. L. 101–650, title III, § 309(a), Dec. 1, 1990, 104 Stat. 5113; Pub. L. 102–198, § 5, Dec. 9, 1991, 105 Stat. 1623; Pub. L. 109–8, title VIII, § 802(d)(6), Apr. 20, 2005, 119 Stat. 146.)Historical and Revision Notessenate report no. 95–989

A principle of the common law requires a court with jurisdiction over a particular matter to take jurisdiction. This section recognizes that there are cases in which it would be appropriate for the court to decline jurisdiction. Abstention under this section, however, is of jurisdiction over the entire case. Abstention from jurisdiction over a particular proceeding in a case is governed by proposed 28 U.S.C. 1471(c). Thus, the court is permitted, if the interests of creditors and the debtor would be better served by dismissal of the case or suspension of all proceedings in the case, to so order. The court may dismiss or suspend under the first paragraph, for example, if an arrangement is being worked out by creditors and the debtor out of court, there is no prejudice to the results of creditors in that arrangement, and an involuntary case has been commenced by a few recalcitrant creditors to provide a basis for future threats to extract full payment. The less expensive out-of-court workout may better serve the interests in the case. Likewise, if there is pending a foreign proceeding concerning the debtor and the factors specified in proposed 11 U.S.C. 304(c) warrant dismissal or suspension, the court may so act.

Subsection (b) gives a foreign representative authority to appear in the bankruptcy court to request dismissal or suspension. Subsection (c) makes the dismissal or suspension order nonreviewable by appeal or otherwise. The bankruptcy court, based on its experience and discretion is vested with the power of decision.

Editorial NotesAmendments

2005—Subsec. (a)(2). Pub. L. 109–8 added par. (2) and struck out former par. (2) which read as follows:

“(2)(A) there is pending a foreign proceeding; and

“(B) the factors specified in section 304(c) of this title warrant such dismissal or suspension.”

1991—Subsec. (c). Pub. L. 102–198 substituted “title 28” for “this title” in two places.

1990—Subsec. (c). Pub. L. 101–650 inserted before period at end “by the court of appeals under section 158(d), 1291, or 1292 of this title or by the Supreme Court of the United States under section 1254 of this title”.

Statutory Notes and Related SubsidiariesEffective Date of 2005 Amendment

Amendment by Pub. L. 109–8 effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of this title.

Notes of Decisions

Cited in 489 cases (62 in the last 5 years), 1979–2026 · leading case: In Re Spade

Sort: Relevance Newest Treatment

In Re Spade (2001) cob · cites it 12× “ORDER ON REMAND REGARDING ORDER TO ABSTAIN PURSUANT TO 11 U.S.C. § 305 DONALD E. CORDOVA, Bankruptcy Judge.”

Profutures Special Equity Fund, L.P. v. Spade (In Re Spade) (2001) cod · cites it 12× “This is the second appeal of the bankruptcy court’s decision to dismiss, under the abstention provisions of 11 U.S.C. § 305 (a), the involuntary bankruptcy case commenced in February 2000 by Appellants ProFutures Special Equity Fund L/P.”

In Re Nexus Communications, Inc. (1985) nceb · cites it 13× “(“Special Markets”), for abstention and dismissal under 11 U.S.C. § 305 , and for a lifting of the automatic stay, and the motion of the debtor, Nexus Communications, Inc.”

In re Costa Bonita Beach Resort Inc. (2012) prb · cites it 7× “DF Servicing also argues in the alternative that this Court should abstain from hearing this case and dismiss it pursuant to 11 U.S.C. § 305 (a)(1) (Docket No. 48). Debtor filed its objection to the motion to dismiss on May 7, 2012 (Docket No.”

Matter of Luftek, Inc. (1980) nyeb · cites it 7× “In July of 1980, thirty of Luftek’s creditors indicated their consent to Luftek’s petition for abstention under 11 U.S.C. § 305 (a). Several of these creditors are listed in the January 31, 1980, accounts payable schedule for amounts which are less than or equal to the amounts…”

In Re Sky Group International, Inc. (1989) pawb · cites it 7× “The most plausible interpretation of the evidence is that the involuntary petition was filed because certain creditors were fearful that they, as unsecured creditors, would receive nothing if UNB were to take the Deed.”

Swift v. Bellucci (In Re Bellucci) (1990) caeb · cites it 7× “This motion for reconsideration poses two issues: (1) whether a bankruptcy court has inherent power to abstain (or defer to state courts) on grounds distinct from the statutory bankruptcy abstentions that are authorized by 11 U.S.C. § 305 and 28 U.S.C. § 1334 (c); and (2)…”

In Re Realty Trust Corp. (1992) nmid · cites it 14× “ORDER OF DISMISSAL — 11 U.S.C. § 305 (a)(1) (1988) MUNSON, Chief Judge.”

In Re Carol Freeman Marsch, Debtor (Two Cases). John D. Marsch, Claimant-Appellant v. Carol F. Marsch, (Two Cases) (1994) ca9 · cites it 3× “The bankruptcy court agreed and dismissed the petition because it did not serve a legitimate purpose under the Bankruptcy Code, and, alternatively, because it was not filed in the best interests of the parties pursuant to 11 U.S.C. § 305 (a)(1). Dismissal was not to be effective…”

In Re T.D.M.A., Inc. (1986) paeb · cites it 7× “On May 29, 1986, the Plan also filed this Motion, specifically designated as a “Motion for Suspension of Proceedings Pursuant to 11 U.S.C. § 305 (a), Abstention Pursuant to 11 [28] U.”

MOAC Mall Holdings LLC v. Transform Holdco LLC (2023) scotus · cites it 2× “Nor does the Code lack for ex- amples of such ties: Consider 11 U. S. C. § 305 (c), which di- rects that certain judicial orders are “not reviewable by ap- 5 Section 1334 grants bankruptcy jurisdiction to the district courts in the frst instance, and those courts may “refe[r]”…”

Crest One Spa v. TPG Troy, LLC (2015) ca2 · cites it 4× “Second, in the alternative, the bankruptcy court concluded abstention pursuant to 11 U.S.C. § 305 (a)(1) was proper, given that litigation regarding the same transaction was already in progress in multiple other forums, and the primary issues implicated state, not federal, law.”

Show all 489 citing cases →

— 11 U.S.C. § 305(a) — 1 case

RHTC Liquidating Co. v. Union Pacific Railroad (In Re RHTC Liquidating Co.) (2010) pawb

— 11 U.S.C. § 305(a)(1) — 2 cases

Hurley v. Kujawa (In Re Kujawa) (1998) moed

In Re Taylor & Associates, L.P. (1996) tneb

Annotations are extracted automatically from the opinions in the Syfert caselaw corpus and ranked by authority, recency, and treatment. Dots show Syfertize treatment of the citing case itself.