Why is bankruptcy called “chapter 11?” What about chapters 10 and 12?


With American giants like Blockbuster and filing for chapter 11 bankruptcy protection, we were wondering where this term came from. Chapter 11 is often used synonymously with bankruptcy, but Chapter 11 and bankruptcy, however, aren’t exactly the same. Chapter 11 is a specific section of the U.S. Bankruptcy Code. It permits the reorganization of

 assets and debts, under court supervision, of an insolvent corporation. Individuals can also seek relief through chapter 11. Chapter 11 also establishes a schedule of payment for debts owed.

Chapter 10 of the code refers to small business money troubles, and chapter 12 has to do with small farmers. The code is contained in what is known as Title 11, and there are 9 chapters within Title 11. There isn’t room in this post to explain the convoluted structure of federal law. The word bankrupt comes from the Latin banca rupta, which literally means “broken bench,” after the practice of moneylenders breaking the table they used when they were no longer in business.

The time it takes for debtors to come out of chapter 11 varies. Depending on the scale of the bankruptcy, it could be a few months or years for a company or individual to emerge from chapter 11.

(Since we’re on the topic of money, why is the dollar sign ($) s-shaped? Get the answer, here.)

The management of a company in chapter 11 is often not fired. This detail alone often enrages critics who say that the chapter 11 allows for too much leniency. (Interestingly, the archaic definition of the word lenient is “softening, soothing, or alleviative.”) Chapter 11 should not be confused with Chapter XI of the United Nations Charter. This is a declaration regarding non-self-governing territories.

Here’s another mystery: How did “dollar” evolve from the word “Joachimsthaler?” Learn the surprising story.

Kohl’s Home State Votes His Party Out; Reaction to Unification Tax Called Decisive As Opposition Breaks 44 Years of Rule

The Washington Post April 22, 1991 | Marc Fisher German voters today used their first opportunity to comment on the post-unification tax hike of Helmut Kohl by ending his Christian Democratic party’s 44 years of rule in the chancellor’s home state.

The traditionally conservative southwestern state of Rhineland-Palatinate swept Kohl’s party out of office by a wide margin, giving opposition Social Democrats control of the state government for the first time since World War II and, in the process, a majority in the Bundesrat, the upper house of Germany’s parliament.

The shift in the Bundesrat gives the opposition the power to block some legislation, weakening Kohl’s ability to lead. Polls indicate that large majorities of Germans believe the government is drifting both in the rebuilding of eastern Germany and in its relationship with its Western allies. web site kohls coupons printable

“This is a clear and bitter loss,” said Volker Ruehe, general secretary of the Christian Democratic Union. “We have hard times in Bonn. We have had to take unpopular decisions.” “This is a loss for the CDU and for Helmut Kohl,” said Rudolph Scharping, the Social Democrat who will become the state’s prime minister.

The Social Democrats, who won 44.8 percent of the vote to the CDU’s 38.7 percent, are expected to form a coalition with the environmentalist Greens, who drew 6.4 percent of the vote. The winners might, however, invite the Free Democrats, the traditional CDU coalition partner who won 6.9 percent, to join them in governing.

Tonight’s loss was the second in two state elections this year for Kohl, whose popularity has plummeted since his steady leadership during Germany’s 11-month march to reunification won him a third term in December. During that campaign, Kohl promised voters in east and west that the reconstruction of eastern Germany would be paid for by private investment. Voters would face no new taxes, the chancellor repeatedly said.

But in February, Kohl announced a massive tax hike to support the five formerly communist states in the east. The Social Democrats, who lost to Kohl last year while focusing on the need to raise taxes and share the cost of unity, pounced on what they billed as the chancellor’s “tax lie.” “One doesn’t vote for people who lie,” said SPD posters plastered throughout the state. this web site kohls coupons printable

The opposition improved its showing by more than 6 percent over the 1987 vote, while CDU support dropped by almost 7 percent. The radical right-wing Republican Party won only 2 percent of the vote.

By strengthening the opposition, voters have made it even harder for Kohl to heal Germany’s wounded relations with its allies, analysts said. For the second time in four months, Germany is torn by a debate over whether its military should join the United States, Britain and France in a joint action.

In the Persian Gulf War, Kohl kept Germany’s armed forces away from the fighting on the basis that the Bonn constitution forbids participation in conflicts outside NATO territory. Since then, however, Kohl has spoken out for an amendment that would specifically permit German troops to join international coalitions like the one in the gulf.

The Social Democrats, however, have said they will agree only to German participation in U.N. peace-keeping forces. A constitutional change requires a two-thirds parliamentary majority, something Kohl cannot hope to muster now.

Defense Minister Gerhard Stoltenberg said this weekend that he wants to send 20 military helicopters to northern Iraq to help build refugee camps for Kurds fleeing from Iraqi forces. But Social Democrat Norbert Gansel called that plan unconstitutional.

The combination of foreign and domestic frustrations has dampened Kohl’s enthusiasm for his job, according to German press reports. Several newspapers have reported that Kohl has even mentioned resigning, a prospect he quickly denied.

Marc Fisher


  1. TallyaWC -  October 25, 2011 - 1:13 am

    Thanks for the article. It is interesting to know that businesses in Chapter 11 can still recover. Therefore having an option to turn things around under special circumstances. Here’s an article that talks about how to plan a business and proposes a framework that might be useful for start ups but also for any business trying to come up with a plan. http://www.voksebiz.com/business-plans-blog/2011/9/20/how-to-start-your-business-plan.html

  2. Telma Elgen -  May 25, 2011 - 1:40 pm

    I just could not depart your web site prior to suggesting that I really enjoyed the standard information a person provide for your visitors? Is gonna be back often in order to check up on new posts

  3. Curly Hair -  September 28, 2010 - 5:58 pm

    Thank you, Dictionary.com, for the etymology of the word “bankrupt” – I found it quite fascinating!


    “capitalize proper nouns such as Chapter 11.”

    How ironic, to speak of proper capitalization and not capitalize the first letter of your sentence. Even more ironic is the fact that you didn’t even capitalize the “g” in your name, which, in case you forgot, is a proper noun – exactly the sort of error for which you criticized this article!

  4. Theresa -  September 27, 2010 - 7:56 am

    To the person writing about Chapter 10,(bankruptcy lawyer) yes there is a Chapter 10 bankruptcy and it is relatively new. It is a form of bankruptcy that a business can file. Check your facts before you comment.

  5. Jim II -  September 27, 2010 - 5:41 am


    Have you considered painting your house so it does not remain the ugliest house on your street? I’m just sayin.

  6. LittleMissLee -  September 26, 2010 - 5:13 pm

    ‎”And that’s how HP ink kept Chapter 1 from becoming Chapter 11…”

  7. Jim -  September 26, 2010 - 1:19 pm

    You have made a fascinating site, so complicated and tedious, in one swipe of a ……that I hate to return to it. The info is tremendous, but the format is horrendous, no style, overdone, reminds me of the ugliest house on my street.

  8. wg -  September 26, 2010 - 8:44 am


    thanks for this.

    why no discussion of chapter7?

  9. Alex -  September 26, 2010 - 8:40 am

    One chapter you don’t hear referred to directly as much is Chapter 7, which is a total liquidation.

  10. grammar -  September 26, 2010 - 1:07 am

    capitalize proper nouns such as Chapter 11.

  11. Kimberly Hiller -  September 26, 2010 - 12:25 am


    Maybe in this blog you can explain what Chapter 13 is since we do see this in the news. FYI – I love these blogs and this website. I am on here daily. Keep up the great work.

  12. PAST DUE | BLOGCHI@mayopia.com -  September 26, 2010 - 12:14 am

    [...] “BANKRUPTCY” — Economically, Morally, Creatively and Comically we are Bankrupt — “Past Due” — When our minds should be catching up. — Technology is improving but “Planned Obsolescence” is “CORRUPT”. – Money Changers in the Temple of Doom — from one hand to another — 7/11. 12 AND 13 — 30 PERCENT INTEREST is Usury. — There’s no shame in filing personal bankruptcy. — “Planned Obsolescence” in reverse is personal bankruptcy and shredded credit cards confusury. — Ain’t it a shame? –>>Rupert L.T.Rhyme [...]

  13. Sandy Lim -  September 25, 2010 - 10:23 pm

    Chapter 11 is not bankruptcy. Chapter 7 is bankruptcy.

  14. LMB -  September 25, 2010 - 8:49 pm

    Your listing is interesting, but as a bankruptcy attorney, I can tell you there is no such thing as Chapter 10. Not sure what your source is for that statement. Nor does a debtor filing for bankruptcy have to be insolvent.

  15. Raja -  September 25, 2010 - 7:00 pm

    Very Nice

  16. Harvest Moon -  September 25, 2010 - 5:20 pm

    Where the 11 come from?

  17. Peter Wexler -  September 25, 2010 - 5:00 pm

    Individuals cannot enter Chapter 11 bankruptcy. I think that Chapter 13 is the equivalent for individuals who seek to “reorganize,” as compared to Chapter 11 which is for corporations.

    Chapter 7, liquidation, applies to all.


  18. Lydia -  September 25, 2010 - 3:11 pm

    I learned something today. Thanks for the info.

  19. chris -  September 25, 2010 - 2:41 pm


    That is just sad because blockbuster was so cool at renting movies for us. I think they filed for bankruptcy chapter 11 because of red box, netflex, and the other cheap renting companies. :’( :(

  20. Bad Credit Mobile Contracts -  September 25, 2010 - 1:24 pm

    That was a brilliant read – I never ever knew what Chapter 11 really meant. I was actually working for a company that notified us that they were filling Chapter 11 and knew that it was a bad thing, but this gives more detail. Thanks.


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