In re Spector Red Ball, Inc.

73 B.R. 759, 1987 Bankr. LEXIS 745
CourtUnited States Bankruptcy Court, W.D. Texas
DecidedApril 14, 1987
DocketBankruptcy No. 5-82-00329-K
StatusPublished

This text of 73 B.R. 759 (In re Spector Red Ball, Inc.) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, W.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Spector Red Ball, Inc., 73 B.R. 759, 1987 Bankr. LEXIS 745 (Tex. 1987).

Opinion

MEMORANDUM OPINION SUSTAINING OBJECTION TO ALLOWANCE OF PROOF OF CLAIM NO. 73i AS A SECURED CLAIM FILED BY INLAND DIESEL, INC.

LARRY E. KELLY, Bankruptcy Judge.

On the 11th day of December 1986 came on to be considered an Objection to the Allowance of Claim No. 73i as a Secured Claim Filed by Inland Diesel, Inc. The Court, having reviewed the pleadings and evidence, makes the following findings:

FINDINGS OF FACT

Prior to the time and origination and filing of its Chapter 11 case in or about April 26,1982, the Debtor was incorporated and domiciled in the State of Texas, although licensed to do business, and was doing business, in approximately 36 other states.

Specifically, Debtor was doing business in the State of Wisconsin. Prior to April 26, 1982, the Debtor contracted for and delivered a GM tractor, number 32288, serial number THY 73 V 689667 to claimant Inland Diesel of Butler, Wisconsin, for the purpose of making repairs to the tractor. In this connection at the time of the creation of said contract and the delivery of said tractor to Inland Diesel, such tractor was located at Specter’s terminal in Oak Creek, Wisconsin.

Prior to April 26, 1982, claimant Inland Diesel made and completed the repairs to said tractor in Butler, Wisconsin.

Prior to April 26, 1982, Inland Diesel, after completing said repairs to said tractor, surrendered possession of the tractor to the Debtor by returning it to Debtor’s terminal and place of business in Oak Creek, Wisconsin, without having first been paid for its repair work and without having received a check or other order of payment.

On April 26, 1982, the Debtor originated and filed this Chapter 11 case without having made payment to Inland Diesel.

On October 12, 1982, Inland Diesel filed an Amended Proof of Claim alleging that the Chapter 11 estate was liable for payment of its claim, as a secured claim, in the amount of $2,256.43 for the repair work done on Specter’s tractor prior to the Chapter 11.

Further, on or about October 12, 1982, Inland Diesel filed a Motion for Adequate Protection wherein it alleged that it had a lien on the above-described tractor. On January 26, 1983, the Debtor-in-Possession filed its Response to Inland Diesel’s Motion for Adequate Protection, alleging that Inland Diesel had returned the tractor to Specter prior to April 26, 1982. After a hearing, at which time Inland Diesel appeared through its counsel, this Court entered an Order denying Inland Diesel’s Motion for Adequate Protection. The basis for the Court’s holding, as stated in the body of the Court’s Order, is as follows:

“... having determined that the work was apparently accomplished by the Claimant on one (1) GM tractor, # 32288, and that such work was performed prior to the filing of these proceedings, and further that said vehicle was surrendered to the Debtors prior to these proceedings, and as a result of same, the Court is of the opinion that the Motion for Adequate Protection should be denied....”

It also appears to the Court that by subsequent Order of the Court, the tractor in question was sold and the proceeds were escrowed pending further determination of the validity of the security interest claimed by Inland Diesel, made the subject of this proceeding.

DISCUSSION

This Court has determined that it may take judicial notice of the pleadings and orders on file in this bankruptcy case and pursuant to prior proceedings. This Court had previously determined and ruled that Inland Diesel had completed the repairs and returned Specter Red Ball, Inc.’s tractor to it before April 26, 1982, that the repair contract in question was entered [761]*761into, performed and payable in the State of Wisconsin, and that the tractor was returned without payment and without a check or other order of payment. In re Missionary Baptist Foundation of America, 712 F.2d 206, 211 (5th Cir.1983).

The key issue before this Court is whether the law of the State of Texas or of the State of Wisconsin applies. No evidence was presented to this Court with respect to the law of the State of Wisconsin. It would, however, appear to the Court clearly that if this law were known, that the law of the State of Wisconsin would apply. The debt was created between the parties in Wisconsin, the property was located in Wisconsin at all pertinent times, the contract for repairs was entered into in Wisconsin, the work was performed in Wisconsin, the bill was tendered in Wisconsin, and possession of the tractor was returned to the Debtor in the State of Wisconsin. It would appear to this Court that the law of Wisconsin is the law which should be looked at to determine the validity of the claim in question. Vanston Bondholders Protective Committee v. Green, 329 U.S. 156, 67 S.Ct. 237, 243, 91 L.Ed. 162 (1946); specifically, the Supreme Court at 67 S.Ct. page 239 of its Vanston opinion gave the following guidelines to be followed by a bankruptcy court in determining and deciding the proper state law to apply:

"... obligations ... often have significant contacts in many states so that the question of which particular state’s law should measure the obligations seldom lends itself to simple solutions. In- determining which contact is the most significant in a particular transaction, courts can seldom find a complete solution in the mechanical formulae of the conflicts of law. Determination requires the exercise of an informed judgment in the balancing of the interests of the states with the most significant contacts in order best to accommodate the equities among the parties to the policies of those states.”

Further, the Fifth Circuit, in Woods-Tucker Leasing Corporation of Georgia v. Hutcheson-Ingram Development Company, 642 F.2d 744 (5th Cir.1981) relying on Vanston held as follows on the same point:

“Where the transaction has multi-state contacts ..., Vanston continues the determination of which particular state’s law should apply ‘requires the exercise of an informed judgment in the balancing of all of the interests of the states with the most significant contacts in order best to accommodate the equities among the parties to the policies of those states.’ Id., 329 U.S. at 162, 67 S.Ct. at 239.”

It would appear to this Court in light of the fact that no party tendered any evidence as to the law of the State of Wisconsin at the hearing, that the Court must consider the issue of judicial notice. Judicial notice is defined generally as a court’s acceptance of the truth of a matter without formal evidentiary proof. 13 Villanova L.Rev. 528, 530 (1969), “The presently extending concept of judicial notice.”

It is fundamental that one of a judge’s primary functions is to decide what substantive law should be applied to the facts of the case before him. Ordinarily, in the course of the law of the forum, the judge finds the law through judicial notice. Saffold v. McGraw-Edison Co., 566 F.2d 621, 623 (8th Cir.1977) (Federal courts must take judicial notice of the statutory and common law of any state of the union without pleading or proof.) (emphasis added).

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73 B.R. 759, 1987 Bankr. LEXIS 745, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-spector-red-ball-inc-txwb-1987.