Subsequent Distribution – Definition and Legal Foundations
Die Subsequent Distribution is a central instrument of insolvency law in Germany. It refers to the distribution of assets acquired by the insolvency estate after the final distribution has already taken place, to the insolvency creditors. The aim of the subsequent distribution is to fairly distribute assets among the insolvency creditors that only accrue to or become known to the insolvency proceedings after the conclusion of the final distribution. The legal foundations for the subsequent distribution are found in the Insolvency Code (InsO), particularly in §§ 203 et seq. InsO.
Requirements for the Subsequent Distribution
Subsequent Accruals to the Estate
A subsequent distribution requires that, after the final distribution, further assets are added to the insolvency estate. Such subsequent accruals may arise from various sources:
- Recovery of assets through avoidance actions (§§ 129 et seq. InsO)
- Realization of previously unrealized assets after the insolvency proceedings have been terminated
- Subsequent discovery of unknown assets
- Income from liability proceedings against former managing directors or third parties
Balancing of Interests and Entitlement to Apply
The subsequent distribution can be ordered ex officio or upon application by a party. The public interest in fair satisfaction of creditors is weighed against the final conclusion of the insolvency proceedings. The insolvency court decides on the order in accordance with § 203 (1) InsO.
Procedure of the Subsequent Distribution
Investigation and Protection of the Estate
Upon learning of additional assets, the insolvency administrator is obliged to secure and realize them. The insolvency estate is expanded by the subsequently added assets. As part of the subsequent distribution, a new register of the involved creditors is created.
Publication and Notification
The insolvency court publicly announces the subsequent distribution in accordance with § 203 (2) InsO. At the same time, the creditors are summoned to assert their claims again, insofar as these have not yet been finally satisfied. Deadlines and the form of notification are determined according to the regulations of the Insolvency Code.
Distribution Key
The subsequent distribution generally follows the same principles as the final distribution. Preferred insolvency creditors are treated in accordance with §§ 38 et seq. InsO. The pro rata distribution is based on the recognized claims of the creditors.
Effects and Legal Consequences of the Subsequent Distribution
Effect with Respect to Creditors
Through the subsequent distribution, the insolvency creditors receive further payments in proportion, provided additional assets are available. The existing ranking according to the InsO remains unaffected. Subordinated claims are only considered after higher-ranking creditors have been fully satisfied.
Effect with Respect to the Debtor and Third Parties
Upon execution and completion of the subsequent distribution, the insolvency administration is finally terminated, provided no further accruals are expected. Claims against third parties that could only be realized after the final distribution are treated equally within the framework of the subsequent distribution.
Claims for Surrender and Recovery
If there are overpayments or unjustified distributions within the framework of the subsequent distribution, recovery claims exist according to the general provisions of the InsO and the German Civil Code (BGB).
Special Scenarios in the Subsequent Distribution
Subsequent Distribution in Consumer Insolvency Proceedings
The subsequent distribution is also possible in simplified consumer insolvency proceedings in accordance with § 212 InsO. The requirements and procedure largely correspond to those of regular insolvency proceedings, although accounting for the particularities of consumer insolvency law and typically smaller additions to the estate.
Subsequent Distribution in Estate Insolvency Proceedings
In estate insolvency proceedings, §§ 203 et seq. InsO apply accordingly. Accruals may, for example, result from later discovered estate components, which must be separately considered and distributed.
Legal Protection and Disputes Related to the Subsequent Distribution
Challenging the Decision on the Subsequent Distribution
Parties are entitled to appeal measures and decisions by the court in connection with the subsequent distribution in accordance with the general provisions. Appeals against a rejection of the subsequent distribution can be lodged with the competent regional court.
Disputed Issues
Typical points of dispute concern the inclusion of specific assets in the estate, the ranking of individual claims, as well as the calculation of the distributable assets and quota.
Termination of Insolvency Proceedings after the Subsequent Distribution
With the conclusion of the subsequent distribution and the satisfaction of all creditors to the extent possible, the insolvency proceedings are finally terminated. Further procedural actions only take place if assets accrue again, which, however, is rare in practice.
Literature and Further Legal Sources
- Insolvency Code (InsO) §§ 203 et seq.
- Commentary literature on the InsO
- Specialist publications on insolvency law
Die Subsequent Distribution is an important instrument for the subsequent satisfaction of creditors, ensures comprehensive realization of the insolvency estate, and emphasizes the importance of complete implementation of insolvency proceedings in accordance with legal requirements.
Frequently Asked Questions
Which legal foundations govern the subsequent distribution in insolvency proceedings?
The subsequent distribution is regulated in German insolvency law, particularly in § 203 InsO. Accordingly, a subsequent distribution may be ordered if, after the final schedule, additional assets accrue to the insolvency estate, for example through subsequent avoidance actions, belated payments by creditors, tax refunds, or the discovery of previously unknown assets. The order is issued by the insolvency court, which also ensures that creditors and the insolvency administrator are involved in the process. Particular importance is attached to the equal treatment of creditors and the prevention of the disadvantage of individual creditors. The distribution generally follows the same rules as the final distribution, while specific procedural and deadline regulations must be observed. The insolvency court may again appoint the insolvency administrator or a subsequent administrator for this purpose.
Who is entitled to apply for the subsequent distribution and how does the procedure function?
In principle, any party to the insolvency proceedings, particularly the insolvency administrator or an insolvency creditor, can apply for the subsequent distribution at the competent insolvency court. The application requires that there are in fact subsequently added estate assets or distributable sums. Upon receipt of the application, the insolvency court examines its admissibility and necessity and, if applicable, issues the respective order. The assets are then secured, valued, and the creditors informed of the subsequent distribution via publication – most often in the central internet register. The same rights and priority rules apply to the distribution as in the main insolvency proceedings.
How are creditors informed about the subsequent distribution and how can they safeguard their rights?
Notification of creditors is carried out in accordance with § 9 InsO, usually by public announcement on the internet. The publication informs creditors of the opportunity to file claims or to review and adjust existing filings. Creditors who have already filed claims in the insolvency table generally do not need to file again, unless changes have occurred regarding the claim or the creditor. In the course of the subsequent distribution, creditors may raise objections to the distribution register or participate in establishing new claims. The court ensures that all legally relevant deadlines and opportunities for participation are observed.
What rights and obligations does the insolvency administrator have in a subsequent distribution?
The insolvency administrator is obligated to inform the insolvency court without delay of any assets subsequently accruing to the estate and, if necessary, to apply for the subsequent distribution. He must take all measures necessary to secure, manage, and prepare the estate for distribution. This includes identifying the assets and ensuring their best possible realization. He is also responsible for preparing a register of the subsequent distribution and for settling the distribution in a timely manner. In carrying out these duties, the administrator is subject both to judicial supervision and to comprehensive reporting obligations to the insolvency court and the involved creditors.
What deadlines and procedural steps must be observed in the subsequent distribution?
After ordering the subsequent distribution, the insolvency court sets deadlines for filing new claims or updating existing ones. These deadlines correspond to those in the main proceedings and are guided by § 28 InsO (creditors’ meetings) and § 189 InsO (final distribution). In practice, the filing period is typically several weeks to months, depending on the scope of subsequently discovered assets. After the deadline has expired, the administrator prepares a distribution list, which is then disclosed for inspection and comments. Subsequently, the final judicial confirmation takes place and actual payment is made to the creditors according to their shares established in the main proceedings.
Can new claims be asserted as part of the subsequent distribution?
In principle, the subsequent distribution is primarily intended for distributing subsequently discovered assets and is based on the already established insolvency table. New claims can only be considered if they only became known later and are relevant under insolvency law. Registration and determination of new claims are carried out under the same rules as in ongoing insolvency proceedings (§§ 174 et seq. InsO). Creditors must file their claims within the deadline set by the court, while the court and the administrator ensure compliance with deadlines and formal requirements.
How is a subsequent distribution concluded and what happens with any remaining assets?
The subsequent distribution is concluded with the full administration and distribution of the subsequently discovered assets – either through payment to the creditors or through another use after fulfillment of all legal requirements. Should further assets be discovered after the distribution, another subsequent distribution is generally possible. After final completion of the procedure, the court issues an order documenting the formal conclusion. Creditors then generally have no further claims from the respective insolvency proceedings, unless – unexpectedly – new assets accrue.
