Oversecured Creditor Entitled To Default Interest If Collateral Soldunder Section 363(B)

An oversecured creditor's right to interest, fees, and related charges as part of its allowed secured claim in a bankruptcy case is well established in U.S. bankruptcy law. Less clear, however, is whether that entitlement encompasses interest at the default rate specified in the underlying contract between the creditor and the debtor. The answer to that question can be a thorny issue in chapter 11 cases because the Bankruptcy Code provides that a chapter 11 plan may cure and reinstate most defaulted obligations, and courts disagree as to whether the power to cure defaults nullifies all consequences of default, including the obligation to pay default interest. The Ninth Circuit Court of Appeals recently had an opportunity to examine the interplay between these seemingly incongruous provisions of the Bankruptcy Code. In General Elec. Capital Corp. v. Future Media Productions, Inc., the court reversed a bankruptcy court order disallowing default interest and costs as part