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Pari passu is a Latin phrase that literally means "with an equal step" or "on equal footing". It is sometimes translated as "ranking equally", [1] "hand-in-hand", "with equal force", or "moving together", and by extension, "fairly", "without partiality". [2]
This term is commonly used in law. Black's Law Dictionary (8th ed., 2004) defines pari passu as "proportionally; at an equal pace; without preference".
In inheritance, a pari passu ( per capita ) distribution can be distinguished from a per stirpes (by family branch) distribution. [3]
For example, suppose a testator had two children A and B. A has two children, and B has three.
This term is also often used in the lending area and in bankruptcy proceedings, where creditors are said to be paid pari passu, or each creditor is paid pro rata in accordance with the amount of his claim. Here its meaning is "equally and without preference". There have been cases where decisions were based on different interpretations of the term. [4] [5]
In the European Union, as the result of the Greek government-debt crisis, a retroactive collective action clause passed by the Greek government with the support of the ECB and IMF, enabled the debtor (who also controlled the courts) to impose a 70% loss on the creditors, more than 75% of whom had voted in favour of the cut. In this case, pari passu means that all private-sector investors are equally treated. [6]
In civil law and Roman law, the legitime, also known as a forced share or legal right share, of a decedent's estate is that portion of the estate from which he cannot disinherit his children, or his parents, without sufficient legal cause. The word comes from French héritier légitime, meaning "rightful heir."
Per capita is a Latin phrase literally meaning "by heads" or "for each head", and idiomatically used to mean "per person". The term is used in a wide variety of social sciences and statistical research contexts, including government statistics, economic indicators, and built environment studies.
Per stirpes is a legal term from Latin, used in the law of inheritance and estates. An estate of a decedent is distributed per stirpes if each branch of the family is to receive an equal share of an estate. When an heir in the first generation of a branch predeceased the decedent, the share that would have been given to that heir would be distributed among that heir's issue in equal shares. It may also be known as strict per stirpes or the old English approach, and differs from distribution per capita, as members of the same generation may inherit different amounts. In section 33 of the Wills Act 1837 in England and Wales, it is called according to their stock.
Wills have a lengthy history.
In common law jurisdictions, probate is the judicial process whereby a will is "proved" in a court of law and accepted as a valid public document that is the true last testament of the deceased, or whereby the estate is settled according to the laws of intestacy in the state of residence of the deceased at time of death in the absence of a legal will.
Distressed securities are securities over companies or government entities that are experiencing financial or operational distress, default, or are under bankruptcy. As far as debt securities, this is called distressed debt. Purchasing or holding such distressed-debt creates significant risk due to the possibility that bankruptcy may render such securities worthless.
The Argentine debt restructuring is a process of debt restructuring by Argentina that began on January 14, 2005, and allowed it to resume payment on 76% of the US$82 billion in sovereign bonds that defaulted in 2001 at the depth of the worst economic crisis in the nation's history. A second debt restructuring in 2010 brought the percentage of bonds under some form of repayment to 93%, though ongoing disputes with holdouts remained. Bondholders who participated in the restructuring settled for repayments of around 30% of face value and deferred payment terms, and began to be paid punctually; the value of their nearly worthless bonds also began to rise. The remaining 7% of bondholders were later repaid 25% less than they were demanding, after centre-right and US-aligned leader Mauricio Macri came to power in 2015.
Pro rata is an adverb or adjective meaning in equal portions or in proportion. The term is used in many legal and economic contexts. The hyphenated spelling pro-rata for the adjective form is common, as recommended for adjectives by some English-language style guides. In American English this term has been vernacularized to prorated or pro-rated.
Forced heirship is a form of testate partible inheritance which mandates how the deceased's estate is to be disposed and which tends to guarantee an inheritance for family of the deceased.
Subordination in banking and finance refers to the order of priorities in claims for ownership or interest in various assets.
United Kingdom insolvency law regulates companies in the United Kingdom which are unable to repay their debts. While UK bankruptcy law concerns the rules for natural persons, the term insolvency is generally used for companies formed under the Companies Act 2006. Insolvency means being unable to pay debts. Since the Cork Report of 1982, the modern policy of UK insolvency law has been to attempt to rescue a company that is in difficulty, to minimise losses and fairly distribute the burdens between the community, employees, creditors and other stakeholders that result from enterprise failure. If a company cannot be saved it is liquidated, meaning that the assets are sold off to repay creditors according to their priority. The main sources of law include the Insolvency Act 1986, the Insolvency Rules 1986, the Company Directors Disqualification Act 1986, the Employment Rights Act 1996 Part XII, the EU Insolvency Regulation, and case law. Numerous other Acts, statutory instruments and cases relating to labour, banking, property and conflicts of laws also shape the subject.
McArthur v. Scott, 113 U.S. 340 (1885), regarded a suit brought to contest a will which directed land to be conveyed to or divided among remaindermen at the expiration of a particular estate, are to be presumed, unless clearly controlled by other provisions, to relate to the beginning of enjoyment by remaindermen, and not to the vesting of the title in them.
A lineal or direct descendant, in legal usage, is a blood relative in the direct line of descent – the children, grandchildren, great-grandchildren, etc. of a person. In a legal procedure sense, lineal descent refers to the acquisition of estate by inheritance by parent from grandparent and by child from parent, whereas collateral descent refers to the acquisition of estate or real property by inheritance by sibling from sibling, and cousin from cousin.
Re Sigma Finance Corporation[2009] UKSC 2 is an English contract law case and the first substantive decision in the Supreme Court of the United Kingdom concerning principles of interpretation. Lord Walker said although he "was one of those who gave permission for a further appeal I find, on closer consideration, that the case involves no issue of general public importance."
The South African law of succession prescribes the rules which determine the devolution of a person's estate after his death, and all matters incidental thereto. It identifies the beneficiaries who are entitled to succeed to the deceased's estate, and the extent of the benefits they are to receive, and determines the different rights and duties that persons may have in a deceased's estate. It forms part of private law.
Belmont Park Investments PTY Ltd v BNY Corporate Trustee Services Ltd[2011] UKSC 38, [2012] 1 All ER 505, [2012] 1 AC 383 is a UK insolvency law case, concerning the general principle that parties cannot contract out of the insolvency legislation. The principle has two key aspects, of which the Supreme Court of the United Kingdom ruled that only the first was relevant on the facts of the case:
Testate succession exists under the law of succession in South Africa.
The anti-deprivation rule is a principle applied by the courts in common law jurisdictions in which, according to Mellish LJ in Re Jeavons, ex parte Mackay, "a person cannot make it a part of his contract that, in the event of bankruptcy, he is then to get some additional advantage which prevents the property being distributed under the bankruptcy laws." Wood VC had earlier observed that "the law is too clearly settled to admit of a shadow of doubt that no person possessed of property can reserve that property to himself until he shall become bankrupt, and then provide that, in the event of his becoming bankrupt, it shall pass to another and not to his creditors."
Timberworld Ltd v Levin was a landmark legal decision concerning whether the peak indebtedness rule operated in New Zealand. The peak indebtedness rule concerns how much a liquidator can claw back of the value paid to a creditor of a company, as part continuing business relationship, prior to the debtor companies liquidation. The Court of Appeal judgment rejected the liquidators contention that the rule should be adopted in New Zealand law.
Chandos Construction Ltd v Deloitte Restructuring Inc, 2020 SCC 25 is a landmark case of the Supreme Court of Canada concerning the position of the anti-deprivation rule within Canadian insolvency law. It held that, because of differences in Canadian law, the rule has wider application relative to the English rule applied by the UK Supreme Court in Belmont Park Investments Pty Ltd v BNY Corporate Trustee Services Ltd.
Ranking equally, meaning literally 'with equal step'.
