The Spanish Supreme Court Interprets Art. 92 Of the Insolvency Act

16 June 2011

On Friday, May 13, 2011, the First Chamber of the Spanish Supreme Court handed down a ruling that provided a new interpretation of Article 92 of the Insolvency Act, regarding subordinated claims, and relating to the deadlines for the filing of claims which differs substantially from the interpretation used until now.

Spanish commercial courts do not allow claims to be submitted after the deadlines specified in rule 5 of section 1 of article 21 and the rule in section 1 of article 85 of the Insolvency Act, that is, one month/15 days to be counted from the day following publication in the Official State Gazette of the court order opening the ordinary/voluntary insolvency proceedings. The Supreme Court has stepped in to correct this overly restrictive interpretation under article 92 of the Insolvency Act.

The new interpretation involves differing treatment for claims filed late and claims not filed at the proper time, which had been considered one and the same until now by the commercial courts.

The Supreme Court clarifies that it is evident that the first rule of article 92 of the Insolvency Act, in addition to referring to those late-filed claims (…) included by the trustee in bankruptcy in the list of creditors also includes those that were not filed at the proper time that can be included in said list by the Judge when ruling on the appeal of same.

The second possibility is open to interpretation: that is, that the claims can be included in the list by the Judge when ruling on their appeal, even when they had not previously been filed and, obviously, they did not appear in the debtor books or documents nor were they included in the insolvency proceedings in any other way.

For further information, please contact César García de Quevedo: