Opinions

The District of Northern Illinois offers a database of opinions for the years 1999 to 2013, listed by year and judge. For a more detailed search, enter the keyword or case number in the search box above.

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Judge Jack B. Schmetterer

In re Joann Smith
April 1, 2004

Judge A. Benjamin Goldgar

Judge Jacqueline P. Cox

03 B 45189

The debtor filed for chapter 11 bankruptcy after MB Financial Bank unexpectedly set off funds in one of its bank accounts to satisfy an overdue loan obligation. While a settlement to return some of those funds was pending, the debtor’s president loaned the debtor “emergency advances” to ensure a construction project could proceed smoothly and to pay employee insurance premiums. The advances were made without notice to other parties or prior court approval. The debtor moved to repay the advances as an administrative expense. Two creditors objected. At issue was whether the advances qualified as valid post-petition extensions of credit to the debtor under 11 U.S.C. § 364. The Court held they were not since the advances were not incurred during the ordinary course of business as they were “emergency” advances. Also, the advances did not meet the vertical dimensions test that examines the reasonable expectations of creditors in light of their past relationship with the debtor and its incurrence of debt, including the amount, terms, frequency, sources, and timing of pre-petition extensions of credit from various sources. The Court also held that the debtor’s president did not hold a general unsecured claim since the advance was made post-petition.

Judge Eugene R. Wedoff

In re UAL Corporation
March 30, 2004
In re UAL Corporation
March 15, 2004

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