OVERVIEW

Methodologically, this project is based on the assumption that legal rules link back to basic principles. These principles, which are the topic of this part of our study, might be more general principles of procedural law, civil law, or law as such, but also specific principles only to be found in insolvency law. It is the objective of this chapter – after having defined the term principles (I.A.) and their functions (I.B.) – to elaborate the tenets applicable to insolvency law (II.) and to discuss which of them are important for shaping and applying transactions avoidance law (III.). We will see that they can be grouped into procedural and substantive principles on the one hand and those which support and those which require restrictions to transactions avoidance law on the other. It will be suggested that these basic standards cooperate in various ways: some norms are supported by more than one principle, others are the result of weighing and balancing conflicting principles.

However, insolvency law nowadays includes restructuring law and it is understood that in many jurisdictions a choice of proceedings exists, some aimed at liquidation of the debtor’s assets and others dealing with restructuring. This trend is vigorously enforced by the EU Directive on restructuring and insolvency. This may have an impact on the principles underlying the different types of proceedings and must be taken into account in this chapter of the book.

DEFINITION

At the beginning of this chapter, the term “principle” needs to be clarified. The word “principle” can be defined in many ways and has been subject to profound jurisprudential contemplation. It is not necessary to enter into this discussion here, since the purpose of this paragraph is not to distinguish “correct” definitions from “incorrect” definitions, but merely to clarify the meaning of the word in the present context, leaving other descriptions unchallenged. “Principles” as a term related to fields of law or sets of legal regulations is frequently used in the sense of “important topics” or “major issues”. However, that is not the way the term “principles” is used in this study.