Pineda Grantor Trust v. Dunlap Oil Co. (In re Dunlap Oil Co.)

Citation:
Pineda Grantor Trust v. Dunlap Oil Co. (In re Dunlap Oil Co.) 9th Cir. B.A.P, BAP No. AZ-14-1172-JuKiD, (December 5, 2014) [Not for Publication]
Tag(s):
Ruling:
In an unpublished opinion, the 9th Circuit Bankruptcy Appellate Panel affirmed the bankruptcy court’s order confirming the second amended joint plan (SAJP) filed by chapter 11 debtors, Dunlap Oil Company, Inc. (DOC) and Quail Hollow Inn, LLC (QHI). The appellate panel did not find Pineda's arguments that the plan was unfeasible, violated the absolute priority rule, and filed in bad faith were unpersuasive.
Procedural context:
Debtor's filed a chapter 11 petition on October 24, 2012 to prevent a state court receiver from being appointed for their business. In November 2012, the bankruptcy court entered a final order approving debtors’ use of cash collateral as set forth in the interim order and attached budgets. Debtors filed a joint plan of reorganization on December 28, 2012. Pineda, CCB, and others objected to debtors’ plan. Debtors subsequently filed a first amended joint plan (FAJP) that provided for the objections by creditors. On November 18, 2013, the bankruptcy court denied confirmation of debtors’ first amended joint plan FAJP plan. Debtors moved for reconsideration of the bankruptcy court’s order. At the December 17, 2013 hearing on reconsideration, the bankruptcy court found that debtors’ arguments did not meet the requirements for reconsideration under Rule 9024, but essentially suggested a revised plan. On December 27, 2013, debtors filed the second amended joint plan SAJP. On March 6, 2014, the bankruptcy court read its ruling granting confirmation of the second amended joint plan SAJP into the record. The bankruptcy court entered the order confirming the SAJP on March 12, 2014. The effective date of the plan was March 28, 2014. On April 10, 2014, Pineda filed its notice of appeal of the order confirming debtors’ second amended joint plan SAJP.
Facts:
Dunlap Oil Company, Inc. (DOC) DOC was founded in 1959. It owned, operated, and leased gas stations and convenience stores throughout Arizona, owned and operated a shopping center known as Dunlap Plaza, and owned vacant land. The Dunlap Revocable Trust owned and operated an 83-room hotel in Wilcox, Arizona, under the Best Western brand. The trust conveyed the hotel to QHI in June 2012. Financing for the acquisition, development, and operation of debtors’ businesses was primarily provided by Canyon Community Bank (CCB) and Compass Bank (Compass). CCB loaned DOC in excess of $8 million which was secured by four properties owned by DOC. Compass also made a series of loans to DOC which were evidenced by promissory notes and secured by seven properties owned by DOC and certain assets owned by QHI. The Compass notes matured by their terms and DOC did not pay them off. Following DOC’s default, the notes were modified through a series of modification and forbearance agreements whereby Compass agreed to forebear from taking any action to enforce the notes provided debtors remained in compliance with certain payment terms and other conditions. The forbearance obligation terminated on November 25, 2009. Debtors made no payments on the notes for several years. In October 2012, Compass sought to have a receiver appointed in the state court. Before Compass could post the bond required for the receivership to take effect, DOC and QHI each filed a chapter 11 petition on October 24, 2012. In November 2012, the bankruptcy court entered a final order approving debtors’ use of cash collateral as set forth in the interim order and attached budgets. Debtors filed a joint plan of reorganization on December 28, 2012. Pineda, CCB, and others objected to debtors’ plan. Debtors subsequently filed a first amended joint plan (FAJP) that provided for the objections by creditors. On November 18, 2013, the bankruptcy court denied confirmation of debtors’ first amended joint plan FAJP plan. Debtors moved for reconsideration of the bankruptcy court’s order. At the December 17, 2013 hearing on reconsideration, the bankruptcy court found that debtors’ arguments did not meet the requirements for reconsideration under Rule 9024, but essentially suggested a revised plan. On December 27, 2013, debtors filed the second amended joint plan SAJP. On March 6, 2014, the bankruptcy court read its ruling granting confirmation of the second amended joint plan SAJP into the record. The bankruptcy court entered the order confirming the SAJP on March 12, 2014. The effective date of the plan was March 28, 2014.
Judge(s):
JURY, KIRSCHER, and DUNN, Bankruptcy Judges.

ABI Membership is required to access the full summary. Please Sign In using your ABI Member credentials. Not a Member yet? Join ABI now - it is absolutely worth it!

About us in numbers

3061 in the system

2954 Summarized

0 Being Processed