Hartford Underwriters Insurance Company v. Union Planters Bank, N. A. (530 U.S. 1)
U.S. Supreme Court · decided May 30, 2000 · Supreme Court Database (Spaeth)
- Citation
- 530 U.S. 1 · 120 S. Ct. 1942
- Decided
- May 30, 2000
- Term
- October Term 1999
- Vote
- 9–0
- Majority author
- Justice Scalia
- Issue area
- Economic Activity
- Disposition
- Affirmed
- Outcome
- Petitioning party lost
- Ideological direction
- Liberal
Opinion excerpt
Justice Scalia delivered the opinion of the Court. In this ease, we consider whether 11U. S. C. § 506(e) allows an administrative claimant of a bankruptcy estate to seek payment of its claim from property encumbered by a secured creditor’s lien. I This case arises out of the bankruptcy proceedings of Hen House Interstate, Inc., which at one time owned or operated several restaurants and service stations, as well as an outdoor-advertising firm. On September 5,1991, Hen House filed a voluntary petition under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Eastern District of Missouri. As a Chapter 11 debtor-in-possession, Hen House retained possession of its assets and continued operating its business. Respondent had been Hen House’s primary lender. At the time the Chapter 11 petition was filed, it held a security interest in essentially all of Hen House’s real and personal property, securing an indebtedness of over $4 million. After the Chapter 11 proceedings were commenced, it agreed to lend Hen House an additional $300,000 to help finance the reorganization. The Bankruptcy Court entered a financing order approving the loan agreement and authorizing Hen House to use loan proceeds and cash collateral to pay expenses, including workers’ compensation expenses. During the attempted reorganization, Hen House obtained workers’ compensation insurance…
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