Courts of law around the world can be used for more than criminal defense or divorce cases. Many courts today are used for maritime litigation, or for bankruptcy filing from minor companies. Maritime litigation, in particular, deals with international law regarding ocean-bound vessels and their cargo and crew, and particular lawyers may be hired for maritime litigation cases on either or both sides. Meanwhile, if a small company declares bankruptcy, bankruptcy court and civil rights may become involved as the debtor works with the creditors to devise a solution. What is there to know about maritime litigation or bankruptcy today?
On Maritime Litigation
According to Investopedia, this describes the international set of laws surrounding cargo vessels and other ocean-bound ships, and these laws operate independently of national laws. This is a highly organized and centralized set of laws; the United Nations has released a number of conventions through the IMO, or the International Maritime Organization in regard to these maritime laws. Nations who have signed these conventions may use their own navies and coast guards to enforce them.
Why might maritime litigation be needed? Court cases and legal disputes are common for ocean-bound vessels in regards to cargo or ship insurance and liability, and cargo may be damaged or lost due to accidents or even acts of piracy. That, or sabotage or other dishonest acts. Insurance claims may be made for the cargo or the ships themselves if they are damaged, sabotage, or even sink entirely. Civil matters between seamen, shipowners, and piracy acts may be settled with maritime litigation as well. The owner of a ship, or example, may pursue litigation if another party caused damage to the vessel or allowed some cargo to become damaged or lost while at sea.
Another legal matter to consider is bankruptcy court. In particular, chapter 11 bankruptcy is a common model for wealthy individuals or smaller companies who recognized that they cannot pay off their debts with their current state of affairs. A company may go bankrupt if its client or customer base dries up, or if its marketing schemes failed. In other cases, a bankrupt company is a victim of robbery. Today, a lot of sensitive information is stored digitally in data servers and Cloud storage, and this information must be protected with firewalls and secure passwords. All the same, while IT countermeasures are often effective, cyber-crime still takes place. This may result in the loss of large sums of money, or client or employee personal information and records being obtained and stolen. Larger companies may suffer hefty losses from such crime, and smaller companies may be driven to bankruptcy entirely after a cyber attack. A bankruptcy court of law can help with this, and the debtor company may turn to bankruptcy law firms to get assistance before and during court.
If the debtor company has acted honestly and transparently so far, it may be considered DIP, or “debtor in possession.” This allows the debtor to remain open and function as a business, with the conditions that it will not take on new loans without the court’s permission. The debtor also may not (without permission) buy or sell property outside of regular business practices or hire lawyers. Violations of these terms may result in the loss of DIP status.
During this court process, the debts will be examined, and the debtor will be asked to create a reorganization plan. Such a plan may allow the debtor to restructure itself and even downsize itself, making the debt easier to pay in part or in full. Such a plan will be presented after some time, and the court may accept it and set it into motion. In rare cases, the plan will be rejected and the creditors may devise their own plan. The debtor may also ask for a time extension if one is needed, and make use of lawyers and other experts in the process of creating that re organizational plan. When a plan is set into motion, it may result in the partial or even total liquidation of the debtor to make debt repayment possible. And in some cases, even total liquidation allows only part of the debt to be paid, and the creditors may have to accept a partial payment of the outstanding debt.