The Bankruptcy Reform Act of 1978 took effect on October 1, 1979, forty years ago today. The new law repealed the Bankruptcy Act of 1898 and modernized the law with a new Title 11, the Bankruptcy Code. Although amended several times in the ensuing years, the Code continues to provide relief for debtors and an avenue for recovery by creditors. The basic framework of the Code was set in place by the Commission on Bankruptcy Laws, which had reported the need for a modern bankruptcy law in a two-part report to Congress in 1973.
The Bankruptcy Reform Act of 1978 also made changes to Title 28 and established the United States Bankruptcy Courts as separate courts within the federal judiciary.
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