Home/N.D. Illinois/KMJ-72 v. Alamand Corp. (In re KMJ-72)

KMJ-72 v. Alamand Corp. (In re KMJ-72)

9 B.R. 534, 1980 Bankr. LEXIS 3987
CourtUnited States Bankruptcy Court, N.D. Illinois
DecidedDecember 5, 1980
DocketBankruptcy Nos. 78 B 8732, 78 B 8733
StatusPublished

This text of 9 B.R. 534 (KMJ-72 v. Alamand Corp. (In re KMJ-72)) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
KMJ-72 v. Alamand Corp. (In re KMJ-72), 9 B.R. 534, 1980 Bankr. LEXIS 3987 (Ill. 1980).

Opinion

MEMORANDUM OPINION AND ORDER

EDWARD B. TOLES, Bankruptcy Judge.

This cause coming on to be heard upon the adjourned first meeting of creditors, the adjourned hearing on indemnity and the adjourned hearing on adjudication or dismissal, pursuant to Section 481(2) of the 1898 Bankruptcy Act (“Bankruptcy Act”) and Chapter XII Rule 12-41(b) and Chapter XII Rule 12-19(d) of the Rules of Bankruptcy Procedure, and due and proper notice of these hearings having been given to all parties entitled thereto, and

The Court having held hearings on the above-mentioned matters on June 3, 4, 5, 24, 25, and 30,1980, and on October 9,1980, and the Court having heard evidence, and the Court having examined the pleadings and files in this cause, and having heard arguments of counsel, and being fully advised in the premises;

The Court Finds:

1. The Debtors, KMJ-72 and WICKEN-BURG INN DEVELOPMENT COMPANY (“Debtors”), represented by the law firm of NACHMAN, MUNITZ & SWEIG, LTD., are both Arizona limited partnerships. The Creditor, ALAMAND CORPORATION, is a Delaware corporation, and the Creditor, DIXIT CORPORATION, is a California corporation and a wholly owned subsidiary of ALAMAND CORPORATION. ALAMAND CORPORATION and DIXIT CORPORATION (“Creditors”) are represented in this [535]*535proceeding by the law firm of KATTEN, MUCHIN, GITLES, ZAVIS, PEARL & GALLER.

2. In September 1973, February 1974, and between February 1974 and February 1975, the Creditor, ALAMAND CORPORATION, through its predecessor in interest, BENEFICIAL STANDARD MORTGAGE INVESTORS (“BSMI”), loaned the Debtors the aggregate sum of $4,400,000.00 for the construction and development of the Wick-enburg Inn (“Inn”). The Inn is a 160 acre tennis and dude ranch located in Wieken-burg, Arizona, about 60 miles north of Phoenix, Arizona. The Inn is surrounded by 2,400 acres of undeveloped desert land which is the subject of two land trusts, White and Suggs (“Trusts”), in which the Debtor, KMJ-72, held second beneficial interests.

3. On August 11,1976, as further security for payment on the above-mentioned obligations, the Debtor, KMJ-72, assigned its second beneficial interests in the Trusts to the Creditor, ALAMAND CORPORATION. In the autumn of 1978 the Creditor, DIXIT CORPORATION, purchased the first beneficial interests in the Trusts.

4. In 1975 the Creditors instituted a foreclosure action against the Debtors in the Superior Court of Yavapai County, Arizona, which was settled by agreement among the parties on August 11, 1976. On July, 18, 1977, a second foreclosure action was instituted by the Creditors in the Superior Court of Yavapai County, Arizona, and the Debtors have denied liability and have counterclaimed on the grounds of fraud and breach of the 1976 settlement agreement. On September 30, 1977, the Superior Court of Yavapai County, Arizona appointed Ira Edward Cheek receiver of the Inn and the surrounding 2,400 acres of undeveloped desert land.

5. On January 26, 1978, the Debtors were notified that they were in default on the Trusts and that they had until November 7, 1978, at 2:00 P.M., Mountain Standard Time, to cure such defaults or forfeit their interests in the Trusts. On November 7, 1978, at 2:30 P.M., Central Standard Time, the Debtors filed two separate Petitions for Arrangements under Chapter XII of the Bankruptcy Act in the United States District Court for the Northern District of Illinois situated in Chicago, Illinois; said cases were assigned to the Honorable Frederick J. Hertz, Bankruptcy Judge, as Case Numbers 78 B 8732 and 8733, and were consolidated on November 7, 1978.

6. On March 29, 1979, the Debtors filed a plan of arrangement, and then filed an amended plan of arrangement on September 21,1979. On October 6,1980, the Debtors filed a second amended plan of arrangement after proofs were closed on the hearings on adjudication or dismissal on June 30,1980, and pending this Court’s final decision. On July 23,1979, the Creditors filed a plan of arrangement. Sufficient acceptances have not been filed to confirm the Debtors’ amended plan of arrangement filed on September 21, 1979, or the Creditors’ plan of arrangement filed on July 23, 1979. On October 9, 1980, the Clerk of the United States Bankruptcy Court for the Northern District of Illinois filed a memorandum with this Court which reads as follows:

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Cite This Page — Counsel Stack

Bluebook (online)
9 B.R. 534, 1980 Bankr. LEXIS 3987, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kmj-72-v-alamand-corp-in-re-kmj-72-ilnb-1980.