The principle of fixation: a drawbridge between private law and bankruptcy law
PhD student: Mrs B. Kramer
Promotor: Prof A.F. Salomons
Duration: 1/9/2019 - 31/8/2025
Research question and problem description The main research question is: How can the principle of fixation (fixatiebeginsel) be interpreted and applied so that it does justice to the objective of bankruptcy and corresponds to other private law subsystems? This study focuses on the principle of fixation, which is regarded as one of the main principles of Dutch bankruptcy law. The fixation of the legal position of all those involved in the estate is instrumental to the objective of bankruptcy, which is to liquidate the assets for the benefit of all creditors. An initial analysis of case law and literature shows that little has been written about the content, scope and function of the principle of fixation. At the same time, the consequences of the declaration of bankruptcy for the legal position of the creditors are not unambiguous and may differ according to the creditors type of right or the type of claim as well as other circumstances. This is problematic for several reasons. Firstly, because the bankruptcy trustee or judge who has to establish or rule on the legal position of the creditors is faced with the question of what specific factors or criteria are relevant to determine that legal position. Secondly, because a lack of clarity and transparency in this respect leads to legal uncertainty and arbitrariness. Thirdly, because the determination of the creditors legal position affects the extent to which the objective of bankruptcy will be achieved and the extent to which that determination corresponds to other subsystems of private law, in particular the law of property and the law of obligations. Whilst the principle of fixation is not unambiguous, it is often referred to in order to justify a particular outcome; it is a placeholder for a test to be carried out on questions affecting the legal position of creditors. This study takes a three-pronged test as its starting point: 1. Does the determination contribute to an equitable distribution of assets? 2. Does the determination respect creditors' rights? 3. Is the determination compatible with the main rules and principles of general private law? In practice, a simplified assessment mechanism is needed which, in most cases, can provide an adequate answer to the question of which claims or rights a given creditor has in bankruptcy. The questions this study aims to answer are whether such a mechanism can be found in the principle of fixation which does justice to the objective of bankruptcy and corresponds to other private law subsystems governing the legal position of creditors outside bankruptcy and, if not, whether any other mechanism or adaptation of that mechanism would be appropriate. Purpose and relevance of the research The purpose of the research is threefold. 1. It aims to contribute to the debate on the meaning and purpose of bankruptcy as a concept and fixation/determination of the legal position of creditors in particular. 2. This concerns not only the effects of fixation on the objective of bankruptcy, but also its impact on other private law subsystems. In other words, the research intends to shed light on the interaction and coherence between the law of bankruptcy on the one hand and the law of property and the law of obligations on the other. 3. Finally, this study aims to contribute to the way in which the principle of fixation is to be interpreted and applied in order to solve practical problems in the field of fixation, as clarity and transparency in this area promote legal certainty and reduce arbitrariness. The study is descriptive for the part where it identifies the consequences of fixation. The study is evaluative for the part where it reveals the friction between fixation and the objective of bankruptcy and between fixation and other subsystems of private law. The research is normative for the part where a statement is formed as to the extent to which these frictions can be resolved or reduced. The research is of fundamental importance both socially and academically because it not only aims to make a normative statement on the way in which the principle of fixation as the 'main principle of the Dutch Bankruptcy Act' is to be interpreted and applied, but also because it touches upon the debate about the (outdated) objective of bankruptcy law and thus, depending on the conclusions, upon the debate about the need for a reform of bankruptcy law. The Dutch debate can be informed by the debate that is taking place abroad and vice versa.