Bankruptcy: A Look Back and a Look Ahead

Bankruptcy Event     On Wednesday, October 22, 2014, the Institute of Delaware Corporate and Business Law presented Bankruptcy: A Look Back and a Look Ahead.  The program was initially intended to feature Judge Helen S. Balick on the subject of the Bankruptcy Act, and bankruptcy as it developed under the Bankruptcy Reform Act of 1978 (the “Bankruptcy Code”).  But due to Judge Balick’s recent accident, Chief Judge Brendan L. Shannon and Judge Peter J. Walsh, of the U.S. Bankruptcy Court, participated in her stead.  The program, conducted in conversation-style format, was moderated by Bruce Grohsgal, the Helen S. Balick Visiting Professor in Business Bankruptcy Law at Widener University School of Law, Delaware.

Early in the program, Chief Justice Shannon recounted Judge Balick’s background and professional history as set forth in an oral history he had conducted in April 2014.  The account of Judge Balick’s remarkable personal and professional career set a tone of tribute that permeated the entire program.

Judge Walsh, when asked what was it like to practice in the 1960s and 1970s compared to now, explained that bankruptcy in Delaware was a local practice until In re Cont’l Airlines, Inc., 125 B.R. 399 (D. Del.) aff’d and remanded, 932 F.2d 282 (3d Cir. 1991) (“Continental”).  There were no New York or Chicago firms and the cases were all relatively small cases.  There were not really a lot of other bankruptcy professionals, and he used to appear before Judge Balick at least once a week.  When he assumed judgeship in 1993, his staff consisted of only three people.  There was only one bankruptcy courtroom, so he and Judge Balick would have to coordinate their schedules to avoid double booking.

Chief Judge Shannon, when asked what is was like to practice before Judge Balick as a young lawyer, explained that Judge Balick was remarkably kind, especially to young lawyers.  Chief Judge Shannon had been admitted to practice in 1992, right after Continental, which was a “staggeringly busy time” for bankruptcy attorneys.  Because of the fast pace, his early practice was challenging, and he had to appear before Judge Balick almost every day.  He described how Judge Balick always gave guidance to young attorneys without embarrassing them.

Chief Judge Shannon then highlighted Judge Balick’s “no nonsense” tone, and noted that her approach has been adopted to varying extents by other judges.  He explained that Judge Balick set the tone that the court would get to the merits and would not let procedural issues hang up the case.  This tone created a really valuable dynamic that enabled the parties to proceed to the merits.  He further noted that the importance of proceeding to the merits is part of Judge Balick’s legacy, and has been instilled to a certain extent in the courts today.

Judge Walsh and Chief Judge Shannon remarked that Continental, followed by In re Columbia Gas Sys., Inc., 136 B.R. 930 (Bankr. D. Del. 1992), changed the practice of bankruptcy in Delaware.  Perhaps not coincidentally, Judge Balick presided over both cases.  Chief Judge Shannon expressed that the two cases were dealt with promptly and that Judge Balick’s “no-nonsense” approach minimized uncertainty and delay, which was important to counsel on both sides.

As Chief Judge Shannon and Judge Walsh recounted cases that had been argued and heard before Judge Balick, the program developed a nostalgic atmosphere.  Reminiscing about past cases from their days in practice, the judges described a much smaller and tight knit bar, prior to the advent of the larger cases that began in the 1990s.  Judge Shannon and Judge Walsh’s high regard for Judge Balick, as formers and as colleagues, reflected the enduring impact of Judge Balick’s career and legacy.




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