In re Southern Film Extruders (Case No. 13-10977)

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Claimants in this matter were employees of the Debtor working as salemen.  During the course of the bankruptcy, debtor had sold substantially all of its assets to a purchaser in exchange for a lump payment.  After the closing of the sale, the claimants each filed a proof of claim asserting claims for commissions based on sales made to customers that were in varying levels of completion, but that had not been collected upon by the debtor.  Afterward, claimants filed a joint motion for allowance of administrative expense claims pursuant to 11 U.S.C. § 503(b)(1)(A), 503(b)(1)(A)(i) and 507(b)(2).  This motion alleged that claimants were entitled to an administrative claim for the work they had done and, alternatively, if they were not contractually entitled to this, that they should be compensated under a theory of quantum meruit.  The creditors’ committee and debtor both moved to dismiss this claim.  The Court held that (1) Claimants’ express contracts provided that commissions would be paid when the debtor collected on the sales, debtor did not collect on the sales and so the claimants were not entitled to payment for them; and (2) claimants could not collect on a theory of quantum meruit because there was an express contract that governed the relationship.

Date: 
Tuesday, March 1, 2016
Published: 
No
Index Heading: 
Claims