On 24 November 2017, the Dutch Supreme Court ruled that in the event a suspension of payments is converted into a bankruptcy, interest that accrues after the suspension of payments was granted, but before the debtor was declared bankrupt, can be presented to the bankruptcy trustee for verification (HR 24 November 2017, ECLI:NL:HR:2017:2991).
The reason for this ruling was a dispute between Credit Suisse Brazil (Bahamas) Limited (hereinafter: Credit Suisse) and the bankruptcy trustee of OSX Leasing Group B.V. (hereinafter: OSX). According to the credit agreements between Credit Suisse and OSX, OSX had to pay interest on the principal amount at 11.5% per annum as from the date of an event of default. OSX was in default as from 30 March 2015 and the Amsterdam District Court granted suspension of payments on 28 April 2015. On 15 July 2015, the Amsterdam District Court converted the suspension of payments into a bankruptcy.
Credit Suisse and the bankruptcy trustee could not agree on whether the interest that had accrued between 28 April 2015 and 15 July 2015 (an amount of nearly EUR 2 million) could be presented to the bankruptcy trustee for verification.
According to the bankruptcy trustee, Credit Suisse’s interest claim was effectively frozen as from 30 March 2015 (the date suspension of payments was granted), invoking Sections 249 and 260 of the Dutch Bankruptcy Act (hereinafter: DBA). According to Section 260 DBA, interest accruing during the suspension of payments will not be taken into account when determining the amount of a creditor’s claim. Section 249 DBA is, in short, a provision that coordinates the conversion of a suspension of payments into a bankruptcy.
Credit Suisse argued that, according to Section 128 DBA, its interest claim was only frozen from 15 July 2015, the date OSX was declared bankrupt. As a result, any interest that had accrued until the date of the bankruptcy declaration could be presented to the bankruptcy trustee for verification.
The Amsterdam District Court requested a preliminary ruling and asked the Supreme Court whether interest accruing during a suspension of payments can be presented to the bankruptcy trustee for verification if the suspension of payments is converted into a bankruptcy.
Until the ruling of the Supreme Court, it had not been settled in case law whether interest accruing during a suspension of payments could be presented to the bankruptcy trustee for verification in a subsequent bankruptcy (e.g. see the following contradictory rulings: Amsterdam Court of Appeal 3 January 2008, JOR 2008/112 and Rotterdam District Court 27 February 2008, ECLI:NL:RBROT:2008:BC6640).
In its preliminary ruling the Supreme Court ruled that the purpose of Section 249 DBA is to provide continuity and unity between the proceedings of suspension of payments and a subsequent bankruptcy. However, this provision does not apply in all instances. For example, according to Section 133 DBA, the value of claims which is not expressed in euros should be determined as of the date on which the bankruptcy order was issued. Section 249 DBA does not imply that its value should be determined as of the date the suspension of payments was granted. The Supreme Court applies the same reasoning to interest accruing between the date suspension of payments was granted and the date of the bankruptcy order.
In conclusion, the principle of Section 260 DBA in connection with Section 249 DBA does not apply to interest claims in a bankruptcy. Consequently, interest accruing during a suspension of payments that is followed by a bankruptcy can be presented to the bankruptcy trustee for verification as a concurrent claim.
The post “Interest accrued during a suspension of payments does count in bankruptcy” is a post of www.stibbeblog.nl