[Download] "Dudley v. Mealey" by Second Circuit Circuit Court Of Appeals ~ eBook PDF Kindle ePub Free
eBook details
- Title: Dudley v. Mealey
- Author : Second Circuit Circuit Court Of Appeals
- Release Date : January 05, 1945
- Genre: Law,Books,Professional & Technical,
- Pages : * pages
- Size : 55 KB
Description
This case comes before us upon two appeals from an order in bankruptcy, approving a plan of reorganization of the Albany Hotel Corporation, a debtor in a reorganization under Chapter X of the Bankruptcy Act, 11 U.S.C.A. 501 et seq. The appeals involve different questions: one is by a committee of shareholders, who assert that the debtor was not insolvent, and that they should not have been excluded from the plan of reorganization as they were. The other is by a single bondholder of an issue known as "General Mortgage 6% Bonds," who complains that certain unsecured creditors were preferred, and that the First Trust Company of Albany, trustee of the bondholders of whom he is one, obtained security through an abuse of its fiduciary position. We shall take up the appeals separately, as our disposition is different for each. The facts are as follows. The debtor which was organized in 1897, owns a large plot of ground in the City of Albany, on which there has been a hotel since 1898. This action was precipitated by an action of foreclosure, commenced on March 17, 1943, by the trustee of another issue, known as the "First and Refunding Mortgage 5% Bonds," in which a receiver was appointed. The debtor on March 20th followed with this action under Chapter X, begun by voluntary petition. On December 31, 1943, the property was subject to four liens, which in the order of their priority were as follows: $16,000 of "First Mortgage 5% Bonds" of date May 1, 1909, overdue, on which interest of $934.06 was unpaid; $784,000 of "First and Refunding 5% Bonds," of date January 1, 1916, not due, on which $58,800 of interest was unpaid; $210,000, "General Mortgage 6% Bonds," of date January 1, 1916, overdue, on which $20,760 of interest was unpaid; $110,000 "Gold 7% Bonds," of date March 29, 1922, overdue, on which $13,475 of interest was unpaid. To these must be added current liabilities, real estate taxes and accounts payable, $182,424.76, making a total indebtedness of $1,396,393.82 on December 31, 1943. Against this there was on that day cash of $70,866.39; accounts receivable of $16,971.12, and inventories of $34,198.71, making a total for current assets of $122,036.22; to which must be added $1,804.08 deposits with public service corporations; bank deposits of $75,677.36, and prepaid expenses of $7,562.16: a total of $207,079.82, which, when subtracted from the total indebtedness just mentioned, leaves $1,189,314, which the fixed assets had to supply, if the debtor was to be solvent. The difference between the financial situation on December 31, 1943 and March 20, 1943, when the petition had been filed, was less than $5000 and may be disregarded.