Tokyo Barrister: Start the law firm bankruptcy

Chapter 883 Variables

In court, Kitahara and Miyakawa filed a lawsuit to revoke the bank's mortgage rights. The bank executives in court also felt the pressure. If these newly added asset mortgages of Nippon Steel were really revoked, it would be tantamount to killing the bank, which means that the bank's previous investment would be lost.

Long before Nippon Steel fell into operational difficulties, these major banks had provided Nippon Steel with several unsecured loans under pressure from the cabinet. This time, Minister of Internal Affairs and Communications Terada put pressure on Nippon Steel to provide a large amount of assistance again, and the banks were forced to ask Nippon Steel to add corresponding guarantees.

It can be said that the newly added guarantee——

It’s not just about the latest investment—

It also concerns the question of whether the previous several loans to Nippon Steel can be guaranteed.

After listening to Miyakawa's complaint, Attorney Abe stood up and retorted: "The purpose of establishing the right of revocation in the Bankruptcy Law is to prevent the debtor from transferring property without compensation. Among them, guarantee behavior is also a disguised way of transferring property, so the Bankruptcy Law gives creditors the right to revoke guarantee behavior."

"But - specifically regarding the bank mortgage in this case, does it fall under the circumstances that require it to be revoked under the Bankruptcy Law? Obviously not."

Abe stood in court and spoke freely:

"The bank did not obtain the mortgage right for free. The bank provided a loan to Nippon Steel, and Nippon Steel provided a guarantee as consideration." Abe emphasized the word "consideration".

Consideration is a legal term.

In simple terms, it means paying a corresponding price to obtain something.

You walk down the street and buy a handicraft for 30 yuan. The 30 yuan is the price you pay for the handicraft.

In the case where the bank obtains a mortgage right -

The consideration for the mortgage right is the loan.

"Nippon Steel did not mortgage its assets to our bank for free. On the contrary, this was a paid act." Abe continued to persuade, "Since it was a paid act, it does not belong to the debtor's act of transferring property for free. Therefore, according to the purpose of the bankruptcy law, the bank's mortgage right is not revocable!!"

Abe suddenly raised his voice at the end.

Miyakawa glanced at Kitahara next to him, then stood up and said, "The bank agent is trying to change the concept. This is not just a question of the debtor transferring property without compensation, but whether it endangers the principle of equal compensation for creditors in the bankruptcy procedure. From the consequences, the bank has established so many security rights in a short period of time, which will inevitably have a great impact on the subsequent equal compensation of creditors."

"That's wrong!" Abe retorted directly: "The bank provided Nippon Steel with the corresponding funds. These loan funds have alleviated Nippon Steel's operating difficulties to a certain extent, allowing it to have a more stable financial situation, that is, more assets can be used to repay debts. How can the behavior of our bank endanger the principle of equal compensation for creditors?!"

"Lawyer Miyakawa! Let me say something unpleasant! Without the bank's funds, Nippon Steel's situation will only get worse!" Abe shouted angrily.

Anbu's words were like building an impenetrable line of defense.

at this time--

Kitahara stood up.

This young male lawyer still had a sense of calmness in the courtroom of the Tokyo High Court. With an unfathomable smile on his face, he said:

"Lawyer Abe, if that's the case, can you tell me how much money you provided to Nippon Steel in total?"

A very simple question.

But it hits the point.

Like an arrow hitting a balloon on a target.

With a "pop" sound, the balloon that the opponent had just completed burst.

When Abe heard Kitahara's question, he was stunned for a moment.

I'm afraid I didn't expect the other party to ask so directly.

The Abe's argument was that Nippon Steel provided so many guarantees because the bank paid for the loan. And now, Kitahara's problem went straight to the core.

So, how much loans did the six major banks provide to Nippon Steel?

Anbu quickly flipped through the materials in his hand, and soon he found that he had no way to answer.

The bankruptcy lawyer's argument only holds water on its surface.

In fact, it is impossible for banks to put up loan funds that match the guarantees.

Otherwise, it becomes a losing business.

If it were a normal company, it would be fine.

With excellent collateral, a loan of 70% or even 80% may be given.

However, for companies like Nippon Steel that are in financial difficulties, they also need to consider the possibility of severe asset depreciation in the future. It is already good to be able to approve a 30% loan based on the value of the collateral. When the assets are auctioned, the value of these collaterals may shrink to less than 30%, and the bank will end up losing money.

So, from a practical point of view -

The value of the collateral and the loan cannot possibly be commensurate.

Anbu's argument can only fool lawyers who are not so serious.

However, if you meet a serious lawyer and start to get serious about specific numbers, this argument will fall apart.

"What's wrong, Lawyer Abe?" Kitahara stepped forward and pressed further, "Why don't you answer my question!"

The smile from before suddenly turned into a rebuke at this moment.

Quickly create a stressful situation.

It must be said that the battle-hardened lawyer Abe also felt nervous. His hands began to shake unconsciously as he flipped through the documents.

"Is there no way to answer?" Beiyuan pressed on.

"Wait a moment...just a moment."

"You have no way to answer!" Kitahara shouted, "According to our investigation results, you were frantically setting up mortgages on Nippon Steel's assets within two weeks before the Tokyo High Court issued a bankruptcy ruling. Among them, more than 60% of Nippon Steel's factories, land, and production equipment were set up as mortgages in just two weeks!"

Kitahara continued to walk towards Lawyer Abe.

The aura of this young man seemed particularly overwhelming at this moment, making people breathless.

"Excuse me! Have you provided a loan amount commensurate with that provided by Nippon Steel in just two weeks? If so, please show us the evidence! Proof is the loan contract, bank statements, and fund receipts!"

"But! If not, all of your newly established mortgages must be revoked!!"

Kitahara's voice echoed in the courtroom.

Lawyer Abe was forced into a corner and was unable to respond.

Everyone present witnessed how such a young man could push a senior bankruptcy lawyer to such an extent. The senior bank executives sitting in the seats could not help but sweat and began to worry about the direction of the case. This lawyer named Kitahara was injecting variables into the Nippon Steel case.

(End of this chapter)