Stubbs & Perdue, P.A. v. Angell (In re Anderson, Jr.)
- Summarized by Lynn Tavenner , Tavenner & Beran, PLC
- 8 years 11 months ago
- Citation:
- Stubbs & Perdue, P.A. v. Angell (In re Anderson, Jr.), Case No. 15-1316 (4th Cir. Jan. 26, 2016).
- Tag(s):
-
- Ruling:
- Affirming the district court, the Fourth Circuit held that the bankruptcy court correctly interpreted/applied Landgraf v. USI Film Products, 511 U.S. 244 (1994), to find that the version of 11 U.S.C. § 724(b)(2) in effect at the time the bankruptcy court rendered its decision was controlling, and that the appellant was not entitled to the subordination of the IRS’s secured tax claim to its chapter 11 administrative expense claim.
- Procedural context:
- Appeal from the district court for the Eastern District of North Carolina affirming the bankruptcy court’s denial of appellant’s attempt under 11 U.S.C. § 724(b)(2) to subordinate the IRS’s secured tax claim to its chapter 11 administrative expense claim, judgment of district court reviewing bankruptcy court reviewed de novo, bankruptcy court’s findings of fact reviewed for clear error, bankruptcy court’s conclusions of law reviewed de novo.
- Facts:
- Law Firm represented debtor in a chapter 11 proceeding and was awarded approximately $200,000.00 in legal fees. The IRS had an approximately $1 million secured tax claim. The case converted to chapter 7 and the chapter 7 trustee did not have the funds necessary to pay both the Law Firm and IRS. Law Firm argued that it was entitled to payment of its fees first pursuant to the version of 11 U.S.C. § 724(b)(2) that existed when the case was filed, which arguably would allow it to subordinate the IRS’s secured tax claim to its chapter 11 administrative expense claim.
- Judge(s):
- Wilkinson, Keenan, and Harris
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