Absolute priority rule

The absolute priority rule is a federal rule of priority for claims in bankruptcy, under Rule 1129(b). Priority is established by 11 U.S.C. § 507.

The priority is as follows:

• domestic and child support claims
• administrative costs during bankruptcy
• in an involuntary bankruptcy case, certain costs incurred prior to the entry of the “order for relief”
• employee claims including benefits within 180 days before the bankruptcy
• retirement claims for contributions to an employee benefit plan, as incurred within 180 days before bankruptcy
• grain farmer and fishermen claimsagainst storage and processing facilities
• deposit claims concerning personal purchases (or leases) for family or household use
• unsecured tax claims
• claims relating to commitments for capital maintenance of FDIC-related institutions
• death or personal injury claims resulting from drunk driving

Waiver

“

By electing to obtain a judgment, with its attendant interest, judgment lien, and judicial collection and enforcement remedies, Mr. Burks surrendered any potential for a wage or earned commission priority. He is not entitled to the double benefit of a judgment claim and an unsecured, priority commission claim. Accordingly, it is ordered that Debtors' Objection to Claim of Sammy Burks is SUSTAINED. The priority status of the claim is denied and the claim is allowed as a general, unsecured, non-priority claim.

”

In re Myer, 197 B.R. 875, 878 (Bankr. W.D. Mo. 1996).