In re F. & W. Grand 5-10-25 Cent Stores, Inc.

S.D. New York

In re F. & W. Grand 5-10-25 Cent Stores, Inc.

7 F. Supp. 854, 1934 U.S. Dist. LEXIS 2036

DecidedMay 14, 1934

StatusPublished

This text of 7 F. Supp. 854 (In re F. & W. Grand 5-10-25 Cent Stores, Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

In re F. & W. Grand 5-10-25 Cent Stores, Inc., 7 F. Supp. 854, 1934 U.S. Dist. LEXIS 2036 (S.D.N.Y. 1934).

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Opinion

PATTEBSON, District Judge.

The claim is founded on a lease made by the claimant to the bankrupt on November 9, 1929, for a twenty-five year term to commence on August 1, 1932. In March, 1932, equity receivers were appointed for the bankrupt, and these receivers gave notice to the claimant on May 21, 1932, that they disaf-firmed the lease. An involuntary petition was filed against the bankrupt on July 14, 1932. The claimant filed proof of claim for $112,500, alleged to be the difference between the rent reserved for the term and the reasonable rental value. The referee expunged the claim.

The claim is one based on the bankrupt’s promise to pay rent in the future. The rule is that such claims are not provable. Manhattan Properties, Inc., v. Irving Trust Co., 291 U. S. 320, 54 S. Ct. 385, 78 L. Ed. 824. The claimant points out that here the term had not yet commenced; further, that prior to bankruptcy the equity receivers had disaffirmed the lease. The first of these was. held not to be a distinguishing feature in Re Metropolitan Chain Stores, Inc. (C. C. A.) 66 F.(2d) 482, and also in Wright v. Irving Trust Co. (C. C. A.) 70 F.(2d) 245, decided April 2, 1934. The second was held unimportant in Re F. & W. Grand 5-10-25 Cent Stores (Possart v. Irving Trust Co.) (C. C. A.) 69 F.(2d) 807, decided March 12, 1934. These are decisions by the Circuit Court of Appeals of this circuit and must be taken as settling the law in this court.

The claimant would have us follow In re Mullings Clothing Co. (C. C. A.) 238 F. 58, also a decision in this circuit. The standing of that case has long been viewed as dubious, Since the Possart Case it must be taken as definitely overruled.

The referee was right in expunging the elaim, and his order will be affirmed.

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PATTEBSON, District Judge.

The claim is founded on a lease made by the claimant to the bankrupt on November 9, 1929, for a twenty-five year term to commence on August 1, 1932. In March, 1932, equity receivers were appointed for the bankrupt, and these receivers gave notice to the claimant on May 21, 1932, that they disaf-firmed the lease. An involuntary petition was filed against the bankrupt on July 14, 1932. The claimant filed proof of claim for $112,500, alleged to be the difference between the rent reserved for the term and the reasonable rental value. The referee expunged the claim.

The claim is one based on the bankrupt’s promise to pay rent in the future. The rule is that such claims are not provable. Manhattan Properties, Inc., v. Irving Trust Co., 291 U. S. 320, 54 S. Ct. 385, 78 L. Ed. 824. The claimant points out that here the term had not yet commenced; further, that prior to bankruptcy the equity receivers had disaffirmed the lease. The first of these was. held not to be a distinguishing feature in Re Metropolitan Chain Stores, Inc. (C. C. A.) 66 F.(2d) 482, and also in Wright v. Irving Trust Co. (C. C. A.) 70 F.(2d) 245, decided April 2, 1934. The second was held unimportant in Re F. & W. Grand 5-10-25 Cent Stores (Possart v. Irving Trust Co.) (C. C. A.) 69 F.(2d) 807, decided March 12, 1934. These are decisions by the Circuit Court of Appeals of this circuit and must be taken as settling the law in this court.

The claimant would have us follow In re Mullings Clothing Co. (C. C. A.) 238 F. 58, also a decision in this circuit. The standing of that case has long been viewed as dubious, Since the Possart Case it must be taken as definitely overruled.

The referee was right in expunging the elaim, and his order will be affirmed.

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7 F. Supp. 854, 1934 U.S. Dist. LEXIS 2036, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-f-w-grand-5-10-25-cent-stores-inc-nysd-1934.

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