The Effects of Annulment or Rescission on the Judicial Settlement Agreement

Abstract

This study examines the legal effects arising from the termination of a judicial settlement agreement, whether through the reopening of bankruptcy proceedings or through the consequences resulting from its rescission or annulment. It explains how bankruptcy proceedings resume, including the debtor's dispossession, the reconstitution of the body of creditors, and the possibility of declaring bankruptcy for a second time. The study also clarifies the limits of the retroactive effect of the termination of the judicial settlement, the continuation of certain guarantees granted to creditors, and the protection of prior transactions and bona fide third parties. Finally, it highlights the legislator's effort to strike a balance between safeguarding creditors' rights and preserving the stability of legal transactions.