Bankr. No.:
99-10142
Chapter:
7
Date of Decision:
August 31, 2000
Issue:
Whether, after he sold some estate real property, the trustee failed to include as creditors to be paid from the proceeds the parties who had originally sold the real property to the debtors?
Ruling:
The trustee's proposed distribution of the proceeds correctly followed the applicable Bankruptcy Code sections that govern the order in which creditors are paid. The sellers did not have a recorded mortgage on the property so they could not be paid as lien holders. The sellers also did not have status as priority unsecured creditors. They were general unsecured creditors. The trustee, after paying liens, administrative expenses, and priority unsecured claims, did not have any money left to pay the sellers' or other general unsecured creditors' claims.
Full Bankruptcy Court Decision:
