Prepetition Liability(redirected from Pre-Petition Liabilities)
A liability that a company incurs before filing for bankruptcy protection. Most prepetition liabilities are reduced or discharged in bankruptcy proceedings; the person or company to whom a prepetition liability is due should not expect to receive the full value of the liability unless it is secured by some asset. A prepetition liability contrasts with a postpetition liability, which usually must be paid in full.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved