CORPORATIONS - REORGANIZATION- FAIR AND EQUITABLE PLAN

Both section 77 B of the federal Bankruptcy Act and chapter X of the Chandler Act provide that the judge shall find the plan of reorganization to be "fair and equitable" before he approves it. This and similar expressions had acquired a well-recognized content in equity reorganization before the statutes were enacted. Congress probably intended to enact the Boyd case rule. Several lower court decisions have expressed doubt as to just what the phrase "fair and equitable" means under the federal Bankruptcy Act.

To find the meaning of the phrase "fair and equitable," it is necessary to look back to the Boyd case and determine what the phrase meant in equity reorganization. This the Supreme Court did in the recent decision of Case v. Los Angeles Lumber Products Co.