To cram down a secured creditor, the debtor must pay the “allowed secured claim” in full. Section 506(a) tells us that the allowed secured claim is the value of the property. It clarifies that by saying, “Such value shall be determined in light of the purpose of the valuation and of the proposed disposition or use of such property.” That means that if the debtor intends to keep the property, it must be valued as a going concern, i.e., the value for the use that the debtor proposes.
In In re Sunnyslope Housing Limited Partnership — F. 3d, —- (9th Cir. April, 2016), we have some weird facts that have resulted in a totally wrong ruling. Read more…
