Marshalling of assets,

Definition of Marshalling of assets:

1. Legal rule that directs the claims of creditors of an insolvent debtor to achieve a fair distribution of debtors assets among them. For example (between two creditors), if one has recourse to one source of funds and the other has recourse to two such sources, the funds will be marshaled by the court so that the claims of both creditors are satisfied in the most equitable manner.