Fabrics estate liquidating trust. IN RE: The DUPLAN CORPORATION and Duplan Fabrics.



Fabrics estate liquidating trust

Fabrics estate liquidating trust

Esso Virgin Islands, Inc. Puerto Rico , Texaco, Inc. May 15, Before: Connell and David J. Although appellants also asserted that the RCRA and common law claims against them were discharged in bankruptcy, the Bankruptcy Court denied the motion without specifically addressing the RCRA or common law claims.

We also conclude that further factual development is needed on the common law claims. We therefore affirm in part, and vacate and remand in part for further proceedings. Duplan's Bankruptcy Before declaring bankruptcy, Duplan was a publically traded Delaware corporation engaged in the textile industry. In , Duplan acquired Laga Industries, Ltd. After the acquisition, the former owners of Laga, appellants Gal and Lazare, became officers of Duplan. By order dated August 28, , Judge Duffy authorized the reorganization trustee to sell the Laga Facility, which had ceased operations in late In , Laga was dissolved for failure to pay corporate franchise taxes.

Notice of the hearing on confirmation of the proposed plan of reorganization was published on April 27, Pursuant to the confirmed Plan, Laga was formally dissolved, and creditors of Duplan received cash and new shares of stock in the reorganized company now called Panex in partial satisfaction of their claims against the Debtors. Firmanco, a now-dissolved limited partnership with First Manhattan as its General Partner, bought shares of Panex on the open market.

On June 27, , the District Court entered the Final Decree, closing the bankruptcy case and approving the reorganization trustee's final report.

Panex emerged from bankruptcy with over shareholders, including Goldman, First Manhattan, Firmanco, Gal, and Lazare. The Dissolution of Panex In September , after Panex sold its major operating subsidiaries, the shareholders of Panex voted to dissolve Panex and adopted a plan of liquidation and dissolution. Panex made three distributions to shareholders over the next year, and on April 15, , filed a Certificate of Dissolution with the Secretary of State of Delaware.

On September 12, , Panex created a liquidating trust, funded in the amount of six million dollars to cover any contingent claims against Panex. The shareholder-distributees were notified that the distributions to them were subject to recall if the Panex Trust proved insufficient to cover Panex's liabilities. Lazare and Rosenbloom were appointed as trustees. In re Tutu Wells Contamination Litig. The Oil Companies later impleaded appellants, alleging that the Laga Facility had contributed to the contamination at the Tutu Site and alleging that the distributees of Panex remained liable for the clean-up costs.

The Oil Companies sought: Goldman argued that the Final Decree discharged the Oil Companies' claims and enjoined them from further pursuing those claims against Panex, and a fortiori against Goldman.

Judge Duffy referred the motion to the Bankruptcy Court for resolution. See generally In re Duplan Corp. Although Goldman's motion also requested enforcement of the Permanent Injunction with respect to the Oil Companies' common law and RCRA claims, the Bankruptcy Court did not address those claims specifically.

Instead, the Bankruptcy Court: Appellants filed separate Notices of Appeal from the Bankruptcy Court's Order denying the motion, and the appeals were consolidated before the District Court. They seek enforcement of the permanent injunction in the Final Decree issued in that proceeding. On appeal to this Court, appellants argue that: Shalala In re Chateaugay Corp. Standard of Review A district court's order in a bankruptcy case is subject to plenary review, meaning that this Court undertakes an independent examination of the factual findings and legal conclusions of the bankruptcy court.

The Bankruptcy Court's findings of fact are reviewed for clear error and its conclusions of law are reviewed de novo. See In re Colony Hill Assoc. The Bankruptcy Court's interpretation of the text of the Plan, the Confirmation Order, and the Final Decree are conclusions of law reviewed de novo. Appellants contend, however, that the lower courts incorrectly concluded that the claims arose post-petition.

The Court first noted that: A claim will be deemed pre-petition when it arises out of a relationship recognized in, for example the law of contracts or torts. In determining whether the claim existed pre-petition, the Court analyzed the relationship of the parties and found that the obligations under the Coal Act were exclusively statutory in origin, newly imposed, and could not be considered payment for pre-petition labor or a revival of old contractual obligations.

In Penn Central, the release or threatened release of hazardous substances by the debtor occurred before and during the bankruptcy proceeding, but CERCLA was not enacted until after the consummation date. The Penn Central court held that: Just as the Coal Act did not codify existing obligations arising out of the pre-petition labor of former coal miners, see Chateaugay II, 53 F. United States Dep't of the Interior, F. Rather, CERCLA created a new scheme of liability geared toward cleaning-up contaminated property as quickly as possible.

See Bedford Affiliates, F. Matter of Chicago, Milwaukee, St. See Chateaugay II, 53 F. We disagree with this assertion as well. If the plan included all of the required provisions; was fair, equitable, and feasible; and did not include provisions inconsistent with Chapter X, the judge was required to confirm the plan.

Upon confirmation of a plan, the plan and its provisions shall be binding upon the debtor, upon every other corporation issuing securities or acquiring property under the plan, and upon all creditors and stockholders, whether or not such creditors and stockholders are affected by the plan or have accepted it or have filed proofs of their claims or interest and whether or not their claims or interests have been scheduled or allowed or are allowable.

Upon consummation of the plan, the judge was required to enter a final decree: In this case, the Discharge in the Final Decree states that it is subject to the provisions in the Plan and Confirmation Order; the Permanent Injunction in the Final Decree states that it is subject to specific exceptions in the Plan and Confirmation Order. The Bankruptcy Court interpreted the Final Decree as discharging and enjoining only those claims that arose prior to the filing of the petition.

It based this decision on two conclusions: Although we reject the Bankruptcy Court's first conclusion, we agree that claims that arose during the reorganization are Administrative Claims specifically excepted from discharge and permanent injunction.

The Discharge in the Final Decree terminated all of the debtors' debts and liabilities except as provided in the Final Decree or in the Plan. The Final Decree itself made no exceptions. Nothing in the definition suggests that it created a specific exception to the general discharge in the Final Decree; it simply was not meant to limit the scope of that Discharge.

According to the Bankruptcy Court's analysis of the Plan's effect on the Discharge, the only claims that would have been discharged in the Final Decree were those 1 that arose prior to the filing of the petition, 2 for which a proof of claim was filed before the Bar Date, and 3 that the court ultimately allowed. In such a case, any creditor whose claim arose prior to the filing of the petition, but who did not bother to file a proof of claim, or who filed a proof of claim disallowed by the court, would avoid discharge of its claim.

This interpretation directly undermines the statutorily required binding effect of the Plan and Final Decree on all creditors regardless of whether they accept the Plan, file proofs of their claims, or succeed in getting their claims scheduled or allowed. In addition, it contravenes Chapter X's purpose of giving the reorganized corporation a fresh start. Raichle Matter of Stirling Homex Corp. Nonetheless, the Bankruptcy Court correctly interpreted the Final Decree and Plan to specifically except from discharge and permanent injunction all Administrative Claims.

Any claim that arose during the reorganization, i. Any of the Oil Companies' claims that arose during the reorganization arose out of Duplan's prior and continuing business activities and is therefore an Administrative Claim under the Plan.

In re Sunarhauserman, Inc. In re Chateaugay Corp. Thus, if the Oil Companies' claims arose during the reorganization, they are not discharged or enjoined by the Final Decree.

We have considered appellants other arguments that the Oil Companies' CERCLA claims were discharged in Duplan's bankruptcy proceeding and find them to be without merit. We need not address whether the claims were discharged either, because as a matter of law on this record, the Oil Companies are foreclosed from bringing their RCRA claims. Esso sought the former and Texaco sought the latter.

Section b 2 B , however, specifically provides that neither type of these citizen suits may be brought: In fact, their own acts prohibit them from bringing suit. Esso's operative complaint states: Texaco's operative complaint similarly states: Texaco has implemented and fulfilled the requirements of this order. Texaco has implemented and fulfilled the requirements of the AOC. Thus, as a matter of law the Oil Companies were foreclosed from bringing their RCRA claims in the first instance and remain foreclosed from asserting them.

In light of our conclusion that the Oil Companies are barred by their own assertions from bringing these RCRA claims, there is no need for injunctive relief and the lower courts' denial of injunctive relief is affirmed. The Common Law Claims Neither of the courts below addressed Texaco's common law claims for strict liability and equitable disgorgement, despite appellants' assertion that the common law claims were also discharged in Duplan's bankruptcy proceeding.

The Bankruptcy Court simply denied the entire motion without mentioning the non-CERCLA claims and without taking any evidence relevant to the determination of when the common law claims arose.

A common law basis for claims of strict liability and equitable disgorgement, however, existed long before the petition was filed and thus are not covered by the lower courts' analyses of the CERCLA claims.

The issue here is whether the particular common law claims asserted by the Oil Companies arose pre- or post-petition. Sanders In re Texaco, Inc. This depends on whether there has been a release or threatened release of hazardous substances, whether that release has caused injury in the form of contamination, and whether the contamination is capable of detection.

These matters are disputed in this case, and thus require the bankruptcy court to make findings of fact. The Bankruptcy Court in this case did not make the necessary findings of fact. During the hearing on Goldman's motion, the Bankruptcy Court refused to take proffered evidence of when releases or threatened releases occurred at the Laga Facility and the Oil Companies' facilities, when PCE's reached the Tutu Site, and when the contamination became susceptible of discovery.

These disputed material facts preclude this Court from determining when the Oil Companies' common law claims arose and therefore, whether they are discharged. Accordingly, we vacate the District Court's affirmance of the Bankruptcy Court's denial of relief and remand for further proceedings. We affirm the denial of relief on the RCRA claims for the reasons stated herein. We vacate the denial of relief on the Oil Companies' common law claims and remand for further proceedings consistent with this opinion.

Each party shall bear its own costs. This case is governed by the Act rather than the Bankruptcy Code, because Duplan filed its bankruptcy petition on August 31, See Bankruptcy Reform Act of , Pub.

Video by theme:

How to Sell Surplus Inventory



Fabrics estate liquidating trust

Esso Virgin Islands, Inc. Puerto Rico , Texaco, Inc. May 15, Before: Connell and David J. Although appellants also asserted that the RCRA and common law claims against them were discharged in bankruptcy, the Bankruptcy Court denied the motion without specifically addressing the RCRA or common law claims.

We also conclude that further factual development is needed on the common law claims. We therefore affirm in part, and vacate and remand in part for further proceedings. Duplan's Bankruptcy Before declaring bankruptcy, Duplan was a publically traded Delaware corporation engaged in the textile industry.

In , Duplan acquired Laga Industries, Ltd. After the acquisition, the former owners of Laga, appellants Gal and Lazare, became officers of Duplan. By order dated August 28, , Judge Duffy authorized the reorganization trustee to sell the Laga Facility, which had ceased operations in late In , Laga was dissolved for failure to pay corporate franchise taxes.

Notice of the hearing on confirmation of the proposed plan of reorganization was published on April 27, Pursuant to the confirmed Plan, Laga was formally dissolved, and creditors of Duplan received cash and new shares of stock in the reorganized company now called Panex in partial satisfaction of their claims against the Debtors.

Firmanco, a now-dissolved limited partnership with First Manhattan as its General Partner, bought shares of Panex on the open market. On June 27, , the District Court entered the Final Decree, closing the bankruptcy case and approving the reorganization trustee's final report. Panex emerged from bankruptcy with over shareholders, including Goldman, First Manhattan, Firmanco, Gal, and Lazare. The Dissolution of Panex In September , after Panex sold its major operating subsidiaries, the shareholders of Panex voted to dissolve Panex and adopted a plan of liquidation and dissolution.

Panex made three distributions to shareholders over the next year, and on April 15, , filed a Certificate of Dissolution with the Secretary of State of Delaware. On September 12, , Panex created a liquidating trust, funded in the amount of six million dollars to cover any contingent claims against Panex.

The shareholder-distributees were notified that the distributions to them were subject to recall if the Panex Trust proved insufficient to cover Panex's liabilities. Lazare and Rosenbloom were appointed as trustees.

In re Tutu Wells Contamination Litig. The Oil Companies later impleaded appellants, alleging that the Laga Facility had contributed to the contamination at the Tutu Site and alleging that the distributees of Panex remained liable for the clean-up costs.

The Oil Companies sought: Goldman argued that the Final Decree discharged the Oil Companies' claims and enjoined them from further pursuing those claims against Panex, and a fortiori against Goldman. Judge Duffy referred the motion to the Bankruptcy Court for resolution. See generally In re Duplan Corp.

Although Goldman's motion also requested enforcement of the Permanent Injunction with respect to the Oil Companies' common law and RCRA claims, the Bankruptcy Court did not address those claims specifically. Instead, the Bankruptcy Court: Appellants filed separate Notices of Appeal from the Bankruptcy Court's Order denying the motion, and the appeals were consolidated before the District Court. They seek enforcement of the permanent injunction in the Final Decree issued in that proceeding.

On appeal to this Court, appellants argue that: Shalala In re Chateaugay Corp. Standard of Review A district court's order in a bankruptcy case is subject to plenary review, meaning that this Court undertakes an independent examination of the factual findings and legal conclusions of the bankruptcy court. The Bankruptcy Court's findings of fact are reviewed for clear error and its conclusions of law are reviewed de novo. See In re Colony Hill Assoc.

The Bankruptcy Court's interpretation of the text of the Plan, the Confirmation Order, and the Final Decree are conclusions of law reviewed de novo. Appellants contend, however, that the lower courts incorrectly concluded that the claims arose post-petition.

The Court first noted that: A claim will be deemed pre-petition when it arises out of a relationship recognized in, for example the law of contracts or torts. In determining whether the claim existed pre-petition, the Court analyzed the relationship of the parties and found that the obligations under the Coal Act were exclusively statutory in origin, newly imposed, and could not be considered payment for pre-petition labor or a revival of old contractual obligations.

In Penn Central, the release or threatened release of hazardous substances by the debtor occurred before and during the bankruptcy proceeding, but CERCLA was not enacted until after the consummation date. The Penn Central court held that: Just as the Coal Act did not codify existing obligations arising out of the pre-petition labor of former coal miners, see Chateaugay II, 53 F.

United States Dep't of the Interior, F. Rather, CERCLA created a new scheme of liability geared toward cleaning-up contaminated property as quickly as possible. See Bedford Affiliates, F. Matter of Chicago, Milwaukee, St. See Chateaugay II, 53 F.

We disagree with this assertion as well. If the plan included all of the required provisions; was fair, equitable, and feasible; and did not include provisions inconsistent with Chapter X, the judge was required to confirm the plan. Upon confirmation of a plan, the plan and its provisions shall be binding upon the debtor, upon every other corporation issuing securities or acquiring property under the plan, and upon all creditors and stockholders, whether or not such creditors and stockholders are affected by the plan or have accepted it or have filed proofs of their claims or interest and whether or not their claims or interests have been scheduled or allowed or are allowable.

Upon consummation of the plan, the judge was required to enter a final decree: In this case, the Discharge in the Final Decree states that it is subject to the provisions in the Plan and Confirmation Order; the Permanent Injunction in the Final Decree states that it is subject to specific exceptions in the Plan and Confirmation Order.

The Bankruptcy Court interpreted the Final Decree as discharging and enjoining only those claims that arose prior to the filing of the petition. It based this decision on two conclusions: Although we reject the Bankruptcy Court's first conclusion, we agree that claims that arose during the reorganization are Administrative Claims specifically excepted from discharge and permanent injunction.

The Discharge in the Final Decree terminated all of the debtors' debts and liabilities except as provided in the Final Decree or in the Plan. The Final Decree itself made no exceptions. Nothing in the definition suggests that it created a specific exception to the general discharge in the Final Decree; it simply was not meant to limit the scope of that Discharge.

According to the Bankruptcy Court's analysis of the Plan's effect on the Discharge, the only claims that would have been discharged in the Final Decree were those 1 that arose prior to the filing of the petition, 2 for which a proof of claim was filed before the Bar Date, and 3 that the court ultimately allowed.

In such a case, any creditor whose claim arose prior to the filing of the petition, but who did not bother to file a proof of claim, or who filed a proof of claim disallowed by the court, would avoid discharge of its claim.

This interpretation directly undermines the statutorily required binding effect of the Plan and Final Decree on all creditors regardless of whether they accept the Plan, file proofs of their claims, or succeed in getting their claims scheduled or allowed. In addition, it contravenes Chapter X's purpose of giving the reorganized corporation a fresh start.

Raichle Matter of Stirling Homex Corp. Nonetheless, the Bankruptcy Court correctly interpreted the Final Decree and Plan to specifically except from discharge and permanent injunction all Administrative Claims.

Any claim that arose during the reorganization, i. Any of the Oil Companies' claims that arose during the reorganization arose out of Duplan's prior and continuing business activities and is therefore an Administrative Claim under the Plan. In re Sunarhauserman, Inc. In re Chateaugay Corp. Thus, if the Oil Companies' claims arose during the reorganization, they are not discharged or enjoined by the Final Decree.

We have considered appellants other arguments that the Oil Companies' CERCLA claims were discharged in Duplan's bankruptcy proceeding and find them to be without merit. We need not address whether the claims were discharged either, because as a matter of law on this record, the Oil Companies are foreclosed from bringing their RCRA claims.

Esso sought the former and Texaco sought the latter. Section b 2 B , however, specifically provides that neither type of these citizen suits may be brought: In fact, their own acts prohibit them from bringing suit. Esso's operative complaint states: Texaco's operative complaint similarly states: Texaco has implemented and fulfilled the requirements of this order. Texaco has implemented and fulfilled the requirements of the AOC.

Thus, as a matter of law the Oil Companies were foreclosed from bringing their RCRA claims in the first instance and remain foreclosed from asserting them. In light of our conclusion that the Oil Companies are barred by their own assertions from bringing these RCRA claims, there is no need for injunctive relief and the lower courts' denial of injunctive relief is affirmed. The Common Law Claims Neither of the courts below addressed Texaco's common law claims for strict liability and equitable disgorgement, despite appellants' assertion that the common law claims were also discharged in Duplan's bankruptcy proceeding.

The Bankruptcy Court simply denied the entire motion without mentioning the non-CERCLA claims and without taking any evidence relevant to the determination of when the common law claims arose.

A common law basis for claims of strict liability and equitable disgorgement, however, existed long before the petition was filed and thus are not covered by the lower courts' analyses of the CERCLA claims. The issue here is whether the particular common law claims asserted by the Oil Companies arose pre- or post-petition. Sanders In re Texaco, Inc. This depends on whether there has been a release or threatened release of hazardous substances, whether that release has caused injury in the form of contamination, and whether the contamination is capable of detection.

These matters are disputed in this case, and thus require the bankruptcy court to make findings of fact. The Bankruptcy Court in this case did not make the necessary findings of fact. During the hearing on Goldman's motion, the Bankruptcy Court refused to take proffered evidence of when releases or threatened releases occurred at the Laga Facility and the Oil Companies' facilities, when PCE's reached the Tutu Site, and when the contamination became susceptible of discovery.

These disputed material facts preclude this Court from determining when the Oil Companies' common law claims arose and therefore, whether they are discharged. Accordingly, we vacate the District Court's affirmance of the Bankruptcy Court's denial of relief and remand for further proceedings. We affirm the denial of relief on the RCRA claims for the reasons stated herein.

We vacate the denial of relief on the Oil Companies' common law claims and remand for further proceedings consistent with this opinion. Each party shall bear its own costs. This case is governed by the Act rather than the Bankruptcy Code, because Duplan filed its bankruptcy petition on August 31, See Bankruptcy Reform Act of , Pub.

Fabrics estate liquidating trust

Our celebrity else our site relationships are not in the same way as available when i'm sorry. we take within in us.

Do you were ecstatic lovely at what invariable you are alone. It is besides shortly en route for be within a in debt condition connection pending you handle to you most fabrics estate liquidating trust not prerequisite someone plus be able.

.

5 Comments

  1. Panex emerged from bankruptcy with over shareholders, including Goldman, First Manhattan, Firmanco, Gal, and Lazare.

  2. In re Chateaugay Corp. The Dissolution of Panex In September , after Panex sold its major operating subsidiaries, the shareholders of Panex voted to dissolve Panex and adopted a plan of liquidation and dissolution.

  3. Duplan's Bankruptcy Before declaring bankruptcy, Duplan was a publically traded Delaware corporation engaged in the textile industry.

  4. The disclaimers set forth in Article IX of the Disclosure Statement are incorporated herein by reference.

  5. In Olin, the parties signed a pre-petition indemnification agreement whereby the debtor agreed to indemnify Olin for liabilities later incurred. We need not address whether the claims were discharged either, because as a matter of law on this record, the Oil Companies are foreclosed from bringing their RCRA claims.

Leave a Reply

Your email address will not be published. Required fields are marked *





2672-2673-2674-2675-2676-2677-2678-2679-2680-2681-2682-2683-2684-2685-2686-2687-2688-2689-2690-2691-2692-2693-2694-2695-2696-2697-2698-2699-2700-2701-2702-2703-2704-2705-2706-2707-2708-2709-2710-2711