Gordon v. Official Committee of Unsecured Creditors (In re Royal Manor Management, Inc.)

Summarized by Dean Langdon , DelCotto Law Group PLLC
13 years 9 months ago

Citation:

12a0482n.06; Docket Nos. 09-4432, 10-4321, 10-4322

Tag(s):

Ruling:

In an opinion not recommended for full-text publication, the Sixth Circuit Court of Appeals affirmed decisions by the District Court and Bankruptcy Court for the Northern District of Ohio which denied creditors' claim and their motion to file a new claim.

Procedural context:

The bankruptcy court denied the Gordons' claim after a bench trial and also denied their motion to file a new claim, finding that no new claim existed, but only different theories of recovery. The district court affirmed.

Facts:

Mother loaned $1 million to her sister and brother-in-law (Schwartzes) in July, 2000, with the agreement identifying mom and her two children, David & Alison Gordon, as creditors. The agreement stated the money was an investment in Darlington Nursing Home, which was owned and operated by two separate companies. The agreement did not name either company as a party, but referred to the Schwartzes repeatedly and was signed by them individually. The agreement was not signed or guaranteed by the companies. When the companies filed for Chapter 11 in 2008, the Gordons filed an unsecured claim for over $2 million against the companies. The bankruptcy court basically interpreted the agreement under applicable state law and the parties stipulated it was not ambiguous so parol evidence was not appropriate. The Gordons sought to file a new claim based on theories of rescission and unjust enrichment. This was also denied by the bankruptcy court, although it indicated the theories could be pursued in connection with the original claim.

Judge(s):

Gibbons, Sutton and Duggan (by designation); opinion by Sutton

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