In Re Colony Square Co.

60 B.R. 1003, 1986 U.S. Dist. LEXIS 25652
CourtDistrict Court, N.D. Georgia
DecidedMay 9, 1986
DocketC84-1109A
StatusPublished
Cited by3 cases

This text of 60 B.R. 1003 (In Re Colony Square Co.) is published on Counsel Stack Legal Research, covering District Court, N.D. Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Colony Square Co., 60 B.R. 1003, 1986 U.S. Dist. LEXIS 25652 (N.D. Ga. 1986).

Opinion

ORDER

RICHARD C. FREEMAN, District Judge.

This case is before the court on Colony Square Company’s (“CSC”) amended motion for disqualification and other relief. An evidentiary hearing was conducted by the court with respect to this motion on October 15-19, 1985. The court directed the parties to file post-hearing briefs and took the matter under advisement. 1

CSC’s motion is predicated on the claim that attorneys from Alston & Bird, counsel for Prudential Insurance Company, wrote certain orders which were signed and issued by Bankruptcy Judge Hugh Robinson without the prior knowledge of counsel for CSC. CSC specifically requests that the court grant the following relief:

*1005 (1) Vacate and expunge the June 25, 1984 judgment and order of Judge Robinson, granting title to the Colony Square complex to Prudential (“the title order”);
(2) Vacate and expunge the April 2, 1985 order and May 7, 1985 judgment of the United States District Court for the Northern District of Georgia, affirming the June 25, 1984 judgment and order of the Bankruptcy Court;
(8) Vacate and expunge the following orders of the Bankruptcy Court:
(i) the September 7, 1984 order denying CSC’s motion for order setting briefing schedule, evidentiary hearing, and oral argument;
(ii) the September 7, 1984 order denying CSC’s motion for order setting briefing schedule and oral argument;
(iii) the October 29, 1984 order denying CSC's motion for disqualification of Judge Robinson;
(iv) the November 26,1984 order denying CSC’s motion for reconsideration of an October 30, 1984 order, motion to strike affidavit of Grant T. Stein, and request for expedited hearing;
(4) Disqualify Judge Robinson from further participation in any proceedings involving CSC;
(5) Disqualify Alston & Bird from further participation in any proceedings involving CSC;
(6) Instruct the Bankruptcy Court to reconsider de novo all of the matters giving rise to an order vacated and expunged by this court;
(7) Award CSC and its counsel their attorneys’ fees and expenses incurred in connection with each of the motions giving rise to an order authored by Alston & Bird, appeals therefrom, and this motion for disqualification and other relief.

Prudential requests that the court deny the relief sought by CSC and instead award Prudential its expenses and fees incurred in defending this motion.

I. Procedural Background

The procedural background leading up to the actions which gave rise to this motion are summarized in this court’s order of April 2, 1985, and in the January 10, 1986 opinion of the Eleventh Circuit. See In re Colony Square Company, 779 F.2d 653 (11th Cir.1986); In re Colony Square Company, Civil Action No. 84-1793A (N.D.Ga. April 2, 1985) (Freeman, J.). On October 16, 1975, CSC filed a voluntary petition under Chapter XII of the Bankruptcy Act of 1898 (formerly 11 U.S.C. § 701 et seq.). In an order dated March 30, 1977, Judge Robinson of the United States Bankruptcy Court for the Northern District of Georgia confirmed the Chapter XII Plan for CSC which had been proposed by Prudential, the principal secured creditor of CSC, and consented to by CSC. The Plan provided that CSC would maintain ownership of the Colony Square Complex and that Prudential would lease and manage this property. The Plan also indicated that the Bankruptcy Court for the Northern District of Georgia retained jurisdiction to enforce the Plan and retained exclusive jurisdiction over the property.

CSC subsequently failed to make cash contributions or bring its debt to Prudential current, as required by a Moratorium Agreement entered into concurrently with the lease. Prudential therefore gave CSC notice that it intended to exercise its option under the Agreement to acquire title to the property. January 29, 1982 was set as the date for tender of the debt-cancellation documents.

On January 28,1982, CSC filed a Chapter 11 case under Title 11, United States Code, as amended by the Bankruptcy Reform Act of 1978, 11 U.S.C. § 101 et seq. The Chapter 11 case was filed in the Bankruptcy Court for the Western District of Pennsylvania (the “Pittsburgh bankruptcy court”). The transfer of title to the property from CSC to Prudential did not take place as scheduled.

Prudential moved to dismiss the Chapter 11 case in Pittsburgh. The motion to dismiss was initially denied by the Pittsburgh bankruptcy court. See In re Colony Square Co., 22 B.R. 92 (Bankr.W.D.Pa.1982). This decision was reversed by the *1006 United States District Court for the Western District of Pennsylvania which, in November 1983, transferred the Chapter 11 case to this court. Prudential Ins. Co. of America v. Colony Square Co., 29 B.R. 432 (W.D.Pa.1983). By order entered February 2, 1984, this court referred the Chapter 11 case to the Bankruptcy Court for the Northern District of Georgia. On March 26, 1984, the bankruptcy court, per Judge Robinson, dismissed the Chapter 11 case. This order, which is not challenged in the instant motion, was affirmed by this court in an order dated June 28, 1985. In re Colony Square Company, Civil Action No. 84-1109A (N.D.Ga. June 28, 1985) (Freeman, J.). In an opinion dated May 6, 1986, the Eleventh Circuit affirmed the order of this court. In re Colony Square Company, 788 F.2d 739 (11th Cir.1986).

On April 30, 1984, an involuntary Chapter 7 petition was filed against CSC in the Western District of Pennsylvania. CSC converted this action to a Chapter 11 proceeding on June 20, 1984. This matter apparently remains pending in the Pittsburgh court.

On February 9, 1984, Prudential filed a motion in the Atlanta bankruptcy court seeking to compel CSC’s compliance with the Chapter XII Plan of reorganization. CSC’s response was twofold, asserting first that Prudential had mismanaged the property, and second, that the automatic stay provision of section 362 of the Bankruptcy Reform Act of 1978, 11 U.S.C. § 362, prevented the Atlanta bankruptcy court from proceeding with the Chapter XII case while the second Chapter 11 action was pending in the Pittsburgh bankruptcy court. On May 14,1984, the Atlanta bankruptcy court issued an order denying CSC's attempt to assert mismanagement and bad faith defenses in connection with Prudential’s motion to enforce the plan. This order, which also is not challenged in the instant motion, was appealed to this court.

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Bluebook (online)
60 B.R. 1003, 1986 U.S. Dist. LEXIS 25652, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-colony-square-co-gand-1986.