today is whether g p l a received a reasonably equivalent value and this court should do so using a do no go or it will because the bankruptcy courts methodology for its valuation was incorrect as to the obligation of bankruptcy court did not even consider whether it was constructively fraudulent even though the trustee did seek to avoid it as to the payments the court assumed that all caymans made pursuant to a contract are per se for reasonably equivalent value and would have tended to prove or in the trustees position disprove that the debtor was likely to get any benefit by making the payment in fact it really analyze the value from vessels perspective the transferee and that's not the inquiry here equipment originally contemplated and this was for a phase one of the facility in phase two were to be constructed it would have to be added back to the contract later yet another change order despite disagreement in september twenty four teen invoice for phase two work that invoice was for two hundred thousand euros and it was due in ten days but it was not paid on time it wasn't paid until december of twenty and when and then shortly thereafter bessel spent yet side this kind of stuff that occurs in the insider deals so what is the logic of this deal that they thought that they would keep on keepin on and that it didn't work out well i evidence that g p l i thought that it would keep constructing the facility but just because you pale i thought that i don't think that means that it actually trip i think the circumstances here show that it was an area unlikely that   nd half of the facility was going to be constructed particularly with the way that it was splintered in half again because by flint doing it in have g p l i wasn't even going to get all that it needed from vessel for phase two of the facility it would have to enter into another obligation to get there so i think that the circumstances show if a company that really doesn't have to finds to construct this billy and is making bad business decisions deciding  new restaurant that is geared towards cozy seating ok but we didn't know that when we built the restaurant so looking at it now you say that was a terrible decision but looking at it at the time when everybody wanted cozy restaurants it made sense well so you look to the value to the debtor but from the standpoint of the creditors so you look to how realistic it wise to expect that the gutter with when you get that value so the code example is actually that's a good one because it's sort of similar to this c debtor could have realized millions of dollars and it was very highly likely that the sale was going to occur in a sale of the airline the separate airline company with white or with making the payments or because there was a buyer who had been and so there are many states laws that have uniform fraudulent transfer act that are modeled off of the bankruptcy code and those have a fair consideration are reasonable equivalents written into them but louisiana state law does not you paid twenty thousand dollars for a car while your bank accounts gone down but you have this twenty thousand dollars car now course car whose value very quickly but nonetheless would you say that was necessarily a dollar for dollar creation solvency i'm now because i think there you have the car but here the debtor doesn't have anything like number one all saying that there are it's not the value of the future or contract is did you get something in your hand so they paid two hundred thousand dollars involved part of the wood pellet bucket or whatever it is then that might have been good enough even if that would help block it by itself to do much they would have at least got something that's right and what they what that evidence stipulated shows that they got is only two hundred and sixty five thousand euros worth of work so there were one million two hundred thousand dollars euro then payments made and only two hundred and sixty five thousand euro going to work but importantly that was all done before this many contingencies that would have g p l i would have had to complete in order to get face to it would have had to make good on this contract which didn't show that it wasn't really able to because it was having trouble making the payments it would have had to enter into another contract with facility capable of producing and this circumstances here really also to me evidence something that this part should take a closer look at because that's always going to make a lot of these milestone payments they're going to say well we if you have a milestone payment obligation it doesn't matter what we do you just have to make the payments but they were even invoicing along with the milestone payment the next invoice they spent was four months later it was a six month contract so the equipment was supposed to have been delivered in six months they had met they were doing no work and they only sent one more came it invoice so the circumstances just don't show contracting parties who had a reasonable expectation that this was going to conjure fruition i know i only have a couple minutes left so one contract ever entered the nd one is envoys before the contract ever entered and then paid after the contract writes in a post justification but it's also not the law that just because a payment is made on a contract it's a reasonably equivalent value you have to look at of payment in order to get no work because i'm a vessel did not perform work after the contract with and the work that it did perform was only worth two hundred and sixty five thousand euros far less than the money that it received and that is just not a contractual obligation for reasonably equivalent value instead the obligation is far outside of what the debtor ever could have or finally vettel is going to probably argue that no matter what we can't wait for it these payments because when i was preparing for this oral argument there was one there was one aspect of this case that was was was bob and me and it was this notion of reasonable equivalent value with respect to the threshold issue of whether the obligation could be avoided under section five hundred and forty eight i would like to start there because we don't get  we don't really get to the payments themselves until we look at the obligation in this case the the light bulb came on for me actually when i really read judge me with mcconnell in the here's the reason why in in the mcconnell case the bankruptcy court conducted a trial where the one of the principal issues was the value of an apartment complex in relation to the purchase price in the contract for the for the purchase of that apartment complex and in that case the purchase price was eight hundred and nineteen thousand dollars so that's the that's the one value and they hadn't they had a trial and the the opinion makes clear that the sides had competing appraisals and quite a bit of testimony as to how much the property was worth and at the end of the day a determination was made that the property was only worth three hundred and twenty thousand dollars whereas the purchase price was eight hundred and nineteen thousand dollars and judge jones  d that it seems self evident as the bankruptcy court found the property only worth three hundred and twenty thousand  at last agreed closing date is not of a reasonably equivalent value for the eight hundred and nineteen thousand total purchase price in that case the debtor had made six hundred thousand dollars worth of deposit says well here's why that important here we had a trial before the bankruptcy court and i'd made reference in the brave to the fact that there really wasn't a lot made of was reasonably a quibble it to the contemplated services and product to be provided by vessel under the contract ok judge haynes made a very good point when she brought up this this notion of hindsight at the time at the time vessel had already completed a twin plant an identical plant had already been completed and was up and running and producing that's in the record so we we have a pretty good idea the bankruptcy court had a pretty good idea of the value because of financial considerations the debtor wanted to change the game plan for the nd plan there's no questions no dispute about that so we had a trial where there was a stipulation that this contract the modified contract or change of water was entered into in good faith arm's length in the ordinary course of business between these two contract and parties with the record reflect we had already built them t plants so there was a familiarity with these contracting parties that is the key point there was nothing at the trial the trustee could have obtained an appraiser to try to make the case that the three as a result the closest we came to having anything in the record suggesting that the that the the value of the plant was even considered in the trustees case in chief was my cross examination of the trustees expert witness where i confirmed that mr alexander was not hired to upon on the value of a completed or any of the things that vessel did with respect to building that plant so that what that was really fatal to the trustees position has been a suggestion in the brief not it was more implicit i think a may be reading too much into it but it seemed to suggest the trustee said the that the bankruptcy courts methodology would suggest we need to remand this or you i'm sorry you all need to remand this case so that the bankruptcy court can consider consider the issue of whether the obligation itself with at the end of the day stipulation as to the fact that there was a valid contract entered into in good faith but i am a party that had just constructed the plant for for this  r not long before we have that and we have nothing concerning reasonably equivalent value of the purchase price in the contract what we did have let out the argument that to get pointed out earlier with the benefit of hindsight perhaps you know i'm pretty sure vessel would not of would not of wanted to do it this way but at the time that this at the time that these payments were made pursuant to this change of water there was there was no reason to believe that it was in that  the nd plant and and get a five hundred thousand metric ton production that's what the st plant was doing and they believed even on the date of the filing of the bankruptcy that they were going to do that  you know again it's hindsight to go back now five years later and say well those guys were nuts they weren't going to find the money but they had just paid us for one plant so if you look at it contemporaneously when this deal was struck which was st verbal and then memorialized in a in a nd change of water then then that that goes away that goes away so what we had was dealing with each other for you even though i don't mean like you know i agree to do this we know we're going to do it i mean if if you had to file a lawsuit to recover on the contract it had to be writing this no no i don't i don't see any any reason why it wasn't a contract to buy and sell real estate which is one of the types of contracts that would require to be in writing these parties have been dealing with each other for years like to say this was our rd plant and this was  change of water to an overall contract that that contemplated two plants been built so what we have is we have a case presented by the of the contemplated scope of the work and the change order but because of that because of that the decision is much easier and it was much easier for judge call way to make with respect to whether payments could be avoided pursuant to that contract just go away rule that there was a contract and therefore these payments were in fact  accordance with the with the contract you know there's a reason why there's not a lot of case law under section five hundred and forty eight of the bankruptcy code with respect to with respect to debt serves to reduce the contract liability of the debtor dollar for dollar that's what happened here ok that the progress of building the thing whatever it was vessel was constructing i don't think any of us know for sure but i was collett the thing the progress of building the thing in germany was not tied to a payment schedule ok so as judge call way found there was a three story point six one million dollars geishas there was roughly a rd of that was paid that reduced the contract liability of the  specifically subsection d two capital finds value defines value as satisfaction a lot of case law on this because what the trustee had was the makings of a pretty decent preference case but the payments were outside the ninety day period so all this talk about the payments were late they were inconsistent that's preference talk each payment reduced the contract liability and gave value so if if the bankruptcy dick code defines payment of an antecedent debt as value it is it's impossible for a court to find that value is not reasonably equivalent value it's actually better it would be like you know something very clear that trustee cannot avoid payments made on account of aniseed debts the treasure valley opinion that we cite to even though it's an idaho bankruptcy case certainly not binding wasn't binding on just go away it's certainly not binding on this corpus of pretty doggone good opinion it was well reasoned and it dealt with the construction through and stomp the payments on of all things  would tell it plant the fact that it was a wood pellets plant is just kind of amusing but the instalment nature of the contract is is very telling because in that case like here the payments were made but the debtor defaulted prior to the creditors obligation to to finish the plant and in the treasure valley case was the continued five talladega of the contract you know we don't nobody knows what mr leibel was doing to try to attract capital to try to keep this company from imploding and ultimately landing in bankruptcy porton was anna but it's pretty clear from the record that the debtor was making efforts to obtain the capital necessary to complete this plant and the continued vitality of this contract was important in that endeavor again this in a natural fraud case mr libel didn't testify there's no suggestion that vessel was part of some scheme or anything we were just building whatever it is we built in germany for these would tell it plants and so the treasure valley case looked at that and considered the continued vitality to be an important element in judge call way embrace that in his opinion as well finding that again without the benefit thousand and fifteen that we weren't going to be able to complete this plan is is is frankly should not be given any weight of all we don't know anything of the sower we know that we have built one plant they paid for largely winning it painful but close enough we know that this contract did not require vessel to pay to deliver anything to the united states until ninety percent of the contract price was pay they didn't come close there's no question who breached the contract here and the point i made about milestone payments st progress payments is it doesn't matter it doesn't matter in this situation how much we had actually constructed by the time the debtor breached the contract point being is when nonny percent was paid we had a contract will obligation to deliver the thing to the united states and we never got there obviously the trustees kind of left in the shoes of the debtor with respect to who breached the contract here i have very little time left so what i would suggest of the court is again if the trustee wanted to know all or of void the underlying contract it was incumbent upon him to put on a case to challenge the three million six hundred thousand euro consideration he didn't do that for whatever reason he didn't do it and judge cole way was well within his discretion to find based on the stipulation that there was a valid contract between the parties and that these were payments made on account of an incident again from there it's a pretty easy case reduced dollar for dollar balance sheet neutral transaction it is irrelevant whether the debtor actually got the thing because the debtor breaks the contract the only the only the only thing we know the only testimony we had at the trial on this was the testimony of mr trost nerd that said we had built them two plants if they had a paid us we'd have delivered this what to now maybe that self serving but the trustee did not present anything to the contrary we never got there we never got close to the point of ninety percent where there was a contractual obligation to deliver something we had full one hundred percent it would have the st contract requires notices to proceed to be in writing so once that st change order amended the contract to say that there was no phase two in order for battle to proceed with were in favor to it would have crux of the trustees argument at trial is that until the nd change order existed there was certainly no obligation or g p l like to make the payments and for a vessel to construct the equipment and that's because it had to be in writing but i also  chain is that in order for the debtor to get the full value of what vessel was to construct for phase two it would have had to enter into another obligation so at the time that this obligation was entered there's just not a high likelihood  the likelihood of receiving the value is what's important here and what is the case the trustee presented at trial if there was going to be any equipment from vessel for phase two which again that state vessel equipment which it's conveying and cooling equipment so i do know what it is it's not going to provide a full phase two that can produce what so that's the difference with the treasure valley case where that contract was for the entire what tell it mean factoring facility and what the court there found was manufacturing facility that's not all we have we have some equipment that actually the testimony elicited from mr trask next trial was that it's specific to this plant it's not capable of being resold because it's of a larger size than most of this kind of equipment so we have some equipment that can't is not the full equipment that the doctor would get from vessel because the doctor would have had to enter into yet another obligation and it's also going to be can you answer those in council tho owed millions of dollars of obligations on these bonds that it was getting to construct the facility it was making haphazard payments it was injuring into an obligation for only some of the equipment because that's all it could afford at the time it would there really have any value unless you get the other half i think that's a very good way of putting it especially because what we do now is that all that vessel did here was a very small amount of work for what it was  you we have your arguments we appreciate the arguments both in this case any of the submitted thank you