Priority in Insolvency Proceedings

Abstract

Insolvency unveils the genuine virtue of the concept of priority. Attempts, however, have

proved that the task of arranging relevant claims in a single line of order according to their

priority is quite difficult and complicated in insolvency proceedings. The reason lies in the fact

that the concept of priority contains three factors; time, amount and method of collection. In

standard non-insolvency compulsory executions, the priority structure affords certain claims to

clearly precede others in time and amount. In this case, the superior creditor is entitled to be paid

in full before and to the exclusion of other junior creditors. There is no other method of collection.