Opinion
Case No. 01-42217 (REG), Jointly Administered.
May 3, 2005
Martin J. Bienenstock (MB 3001), Deryck A. Palmer (DP-6351), WEIL, GOTSHAL MANGES LLP, New York, NY, Attorneys for Debtors.
Richard B. Polivy (RP 1838), POLIVY TASCHNER, LLC, Hartford, CT, Attorneys for Geoffrey J. Crowley.
Steven H. Rittmaster (SR-3510), Robert Beau Leonard (RL-4010), TORRE, LENTZ, GAMELL, GARY RITTMASTER, LLP, Jericho, NY, Attorneys for Lumbermens Mutual Casualty Company.
WHEREAS, prior to the commencement of the above-entitled Chapter 11 cases, Geoffrey J. Crowley ("Crowley") applied, on or about February 9, 2001, for a Prejudgment Remedy of Attachment in the Connecticut Superior Court, Judicial District of Hartford at New Britain against assets of Debtor Ames Department Stores, Inc. ("Ames"), and relating thereto obtained a certain attachment bond in lieu of attachment, issued by Lumbermens Mutual Casualty Company, a member of the Kemper Insurance Companies ("Kemper"), as surety for Ames, in the amount of $75,000, bearing Bond # 3S 994 623, dated May 11, 2001 (the "Bond").
WHEREAS, in the above-entitled Chapter 11 case a certain Corrected Stipulation of Settlement and Order (Docket #967) dated June 4, 2002, was filed on June 5, 2002, signed by and on behalf of Ames, Kemper, and Crowley, as assignee of MK Commercial Kitchens, Inc., as successor in interest to Miss King's Kitchen, Inc., under which it was agreed, inter alia, that Miss King's Kitchen, Inc., its successors or assigns, may collect against the Bond pursuant to its terms and upon a determination by the Bankruptcy Court of an allowed claim in the above-entitled Ames Chapter 11 case, pursuant to section 502(b) of the Bankruptcy Code; and
WHEREAS, Crowley filed a motion (Docket #2785), seeking allowance of such a claim, which was filed in this case by Crowley as Claim #671 on or about February 15, 2002 (the "MK Claim"), which motion was scheduled for a hearing date of April 20, 2005, and for which the deadline for filing objections was April 15, 2005, at 4:00 PM; and
WHEREAS, Ames has listed the MK Claim in its schedules as disputed, and as is recited in the aforesaid Corrected Stipulation of Settlement and Order (Docket #967) dated June 4, 2002, this Court has jurisdiction over Kemper, the subject matter at issue, and enforceability under the Bond; and
WHEREAS, no other creditor or other party has filed any objection to such motion seeking allowance of such claim; and
WHEREAS, Ames, Kemper and Crowley wish to settle, compromise and resolve such claim and all objections thereto on the terms and conditions described herein, and subject to a full reservation of all other rights and positions between Ames and Kemper with respect to each other and as to all of the other Debtors in the proceedings jointly administered herewith (and anyone else), as to any matter not directly related to the MK Claim and/or Crowley;
NOW, THEREFORE, Ames, Kemper and Crowley have stipulated and agreed as follows:
1. Crowley warrants and represents that he is the real party in interest and rightful owner of all rights and claims of Miss King's Kitchen, Inc.; that he is the assignee of MK Commercial Kitchens, Inc., as successor in interest to Miss King's Kitchen, Inc. with respect thereto; and that no claim has been or will be filed against Ames or Kemper by MK Commercial Kitchens, Inc. or Miss King's Kitchen, Inc. or any assignee or successor thereof arising out of or relating to the subject of the aforesaid MK Claim.
2. The MK Claim is settled and allowed in the amount of $50,000 as a general unsecured claim. Such settlement sum shall be paid forthwith by Lumbermens Mutual Casualty Company, as surety for Ames, under its aforesaid attachment bond, to Crowley, as assignee of MK Commercial Kitchens, Inc., as successor in interest to Miss King's Kitchen, Inc. The parties hereto further represent that all relevant considerations were taken into account in reaching this settlement, including among other things the rules regarding preferences (under Bankruptcy Code § 547 or otherwise), and that no claim, proceeding or defense will be asserted, in any way relating to the MK Claim or to this settlement or Stipulation, under or otherwise relating to such rules regarding preferences.
3. In consideration of such settlement payment (and conditioned upon receipt thereof), Crowley hereby:
i. releases Ames from all claims, causes of action and obligations of whatsoever kind or nature, whether currently known or unknown, in any way arising from or relating to the subject of the MK Claim or of the aforesaid attachment bond, to the extent not assigned to Kemper as provided herein (i.e., over and above such settlement sum of $50,000);
ii. assigns to Kemper the aforesaid MK Claim to the full extent of such settlement sum of $50,000; and
iii. releases Kemper (including Lumbermens Mutual Casualty Company) from any and all claims, causes of action and obligations of whatsoever kind or nature, whether currently known or unknown, in any way arising from or relating to the subject of the MK Claim or of the aforesaid attachment bond.
4. Payment of such settlement sum by Kemper is conditioned upon the execution and delivery by Crowley to Kemper of an assignment and release in a form acceptable to Kemper, heretofore furnished by Kemper's counsel to Crowley's counsel.
5. Promptly upon receipt of such settlement sum, Crowley's counsel shall cause to be filed in the Connecticut Superior Court under Docket No. CV-01-0505929S a withdrawal discontinuing the state court action commenced against Ames.
6. Upon payment of such settlement sum, Kemper shall be entitled to file a notice of transfer of claim under Bankruptcy Rule 3001(e)(2) with respect to the allowed MK Claim in the amount of $50,000, and Kemper shall at an appropriate time elect either (i) to receive distributions from the Ames estate under such MK Claim as assigned to Kemper (without prejudice to whatever other rights Kemper may have against the Debtors that are unrelated to the MK Claim), or alternatively (ii) to vacate the MK Claim and include the $50,000 amount thereof in whatever amount is allowed as a liquidated general unsecured claim under the proof of claim heretofore filed in the name of Kemper (or Lumbermens Mutual Casualty Company). Nothing contained in this Stipulation shall be deemed to otherwise affect any rights or claim or proof of claim of Kemper (including Lumbermens Mutual Casualty Company) against Ames or any other Debtor or anyone else.
7. This Stipulation of Settlement and Order constitutes the entire agreement of the parties relating to the subject matter described herein, except as shall be supplemented by the settlement documents to be executed in connection herewith as described herein, and there are no other agreements or understandings between or among the parties of any kind relating to the subject matter of this Stipulation of Settlement and Order. The parties hereto acknowledge that no representations, warranties or covenants of any kind have been made to or relied upon by them except those expressly set forth in this Stipulation of Settlement and Order.
8. This Court shall have exclusive, continuing jurisdiction over any dispute or other proceeding arising from or relating to this Stipulation of Settlement and Order.
9. This Stipulation may be signed in multiple counterparts, all of which taken together shall be considered a single instrument, and electronic facsimile copies thereof may be filed with the Court with the same effect as the originals.
10. Counsel executing this Stipulation in a representative capacity represent that they are fully authorized to execute this Stipulation in such capacity and thereby to bind their respective indicated clients.
11. For purposes of Local Bankruptcy Rule 9072-1, the parties identified below are deemed to be all of the parties to the referenced motion filed as a contested matter by Crowley, no other opposition having been filed or otherwise received by the undersigned counsel in relation thereto.
SO ORDERED.