The role of the judge-commissioner in restructuring proceedings

Restructuring proceedings are a complex process aimed at restoring the debtor's operational and financial capacity and protecting the interests of creditors. The key role in this process is played by the judge-commissioner, who supervises the course of the proceedings, decides on important procedural issues and ensures a balance of interests of all parties. This article aims to present the role, competences and duties of the judge-commissioner in the individual stages of restructuring proceedings, taking into account practical aspects important for entrepreneurs.

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Legal status and appointment of judge-commissioner

The judge-commissioner is appointed by the restructuring court from among the judges of the court before which the proceedings concerning the opening of restructuring proceedings are conducted. The status and competences of the judge-commissioner result from the provisions of the Act of 15 May 2015 - Restructuring Law. The main tasks of the judge-commissioner include managing the course of restructuring proceedings, supervision over the activities of the judicial supervisor and administrator and designation of activities that may not be performed by these entities without the consent of the Judge Commissioner or the consent of the creditors’ committee.

Competencies and duties of the judge-commissioner

The Judge Commissioner in restructuring proceedings has four key functions:

a) Management function

The judge-commissioner manages the course of the restructuring proceedings, ensuring their compliance with the law and the interests of all participants. His competences include:

• Convening a meeting of creditors: The judge-commissioner determines the date, place and subject of the meeting of creditors and chairs its meetings.
• Establishment of creditors' committee: In situations provided for by law, the judge-commissioner appoints the creditors' council and convenes its meetings.
• Supervision over the activities of the judicial supervisor and administrator: The judge-commissioner supervises the activities of these bodies, drawing attention to any irregularities committed by them and designating activities whose performance requires his consent or the consent of the creditors' committee.

b) Supervisory function

The judge-commissioner supervises the activities of the judicial supervisor and administrator, ensuring the proper management of the debtor's assets and compliance of these entities' activities with the provisions of the law. As part of this function, the judge-commissioner:

• Checks the documentation: Approves financial statements, restructuring plans and other documents submitted by the judicial supervisor or administrator.
• Intervenes in case of irregularities: Issues warnings or imposes fines on the judicial supervisor or administrator if any irregularities are found in their actions.

c) Judicial function

The judge-commissioner resolves disputes and makes procedural decisions during the restructuring proceedings. His/her competences in this area include:

• Recognition of objections from creditors: The judge-commissioner decides on the objections of creditors concerning the omission of their receivables from the list of receivables.
• Approval of tender or auction conditions: In restructuring proceedings, the judge-commissioner approves the terms of sale of the debtor's assets.

d) Disciplinary function

The judge-commissioner has the authority to discipline the judicial supervisor and administrator in the event of irregularities in their actions. As part of this function, he may:

• Issue warnings: Draw attention to deficiencies and indicate appropriate corrective actions.
• Imposing fines: Imposing financial sanctions on the judicial supervisor or administrator in the event of serious misconduct.

The role of the judge-commissioner in managing the course of the proceedings

The judge-commissioner, as the main manager of the restructuring process, sets the direction and strategy of the proceedings. He has the right to make decisions regarding the management of the debtor's assets, convening creditor meetings and approving the restructuring plan. For example, the judge may:

• Convene creditors' meetings: For the purpose of voting on the restructuring agreement.
• Establish the terms of creditors' participation: Determine what criteria creditors must meet in order to participate in the proceedings.
• Monitor the progress of the restructuring plan: Supervise the implementation of the plan and intervene in the event of delays or irregularities.

The role of the judge-commissioner in managing the proceedings is crucial to their smooth running. Thanks to their broad powers, they can take actions that minimize the risk of delays and ensure that the proceedings are conducted quickly and effectively.

Practical example:

• The Judge Commissioner was appointed in the restructuring proceedings conducted in the proceedings of an entrepreneur conducting production activities. The Council of Creditors was not appointed during the proceedings. The debtor filed an application to the Judge Commissioner for consent and determination of the principles for the sale of part of the warehouse stocks, in the scope in which it no longer plans to continue production activities. The total estimated value of these stocks amounted to PLN 2 million. The Judge Commissioner, by order, consented to the sale, indicating the conditions and the minimum sale price.

Cooperation with other participants in the proceedings

The judge-commissioner cooperates with many entities involved in restructuring proceedings, including:

• With the judicial supervisor and administrator: Monitors their activities and issues instructions regarding the management of the debtor's assets.
• With creditors: Ensures that their rights are respected and resolves disputes regarding receivables and arrangements.
• With the debtor: Ensures that the debtor's actions are lawful and that the debtor's assets receive maximum protection.

The importance of the role of the judge commissioner for the success of restructuring

The effectiveness and efficiency of conducting restructuring proceedings largely depends on the efficiency and competence of the judge commissioner. His decisions have a direct impact on the course of the proceedings and their results. Therefore, the judge commissioner should be characterized by a high level of legal knowledge, independence, decisiveness and the ability to resolve conflicts between the parties to the proceedings.

Summary

The role of the judge commissioner in restructuring proceedings is crucial for the effective protection of the interests of creditors and the debtor. His function includes supervision over the correctness of the proceedings, resolving disputes and ensuring that the restructuring is carried out effectively and in accordance with the law. Therefore, the effectiveness of the judge commissioner's work is one of the key elements of the success of the entire restructuring process. For entrepreneurs, knowledge of the regulations, powers and the role of the judge commissioner can be crucial to the success of the restructuring.