Debtor in Possession
/ˈdɛtər ɪn pəˈzɛʃən/
Definitions
- (n.) A debtor who retains possession and control of property and business operations while undergoing reorganization under bankruptcy law, typically under Chapter 11.
The debtor in possession must operate the business prudently to maximize value for creditors during the bankruptcy process.
Forms
- debtors in possession
Related terms
See also
Commentary
A debtor in possession holds fiduciary duties similar to a trustee and must comply with court oversight; legal drafting should specify DIP authority limits.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.