Bankr. No.:
91-10002
Chapter:
12
Date of Decision:
October 25, 1991
Issue:
Whether FmHA was entitled to set off post-petition payments from pre-petition CRP contract against its pre-petition claim?
Ruling:
CRP contract was an executory contract that did not presumptively constitute a pre-petition debt owed by the creditor to the debtor. Thus, that requirement for setoff under 11 U.S.C. § 553 was not satisfied. The Court declined to follow the line of cases which hold a debtor and a debtor-in-possession are not same party when the "mutuality of the debt" requirement under § 553 is considered. In re Gerth, 136 B.R. 241 (Bankr. D.S.D. 1991).
Full Bankruptcy Court Decision:
Appeal Summary:
The district court affirmed the bankruptcy court’s decision. However, in United States v. Gerth, 991 F.2d 1428 (8th Cir. 1993), the Court of Appeals reversed in part, vacated in part, and remanded the case to the bankruptcy court for a determination of whether the creditor was entitled to relief from the automatic stay. District Court Opinion not available.
Full Eighth Circuit Court of Appeals Opinion: