<PAGE>
 
<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-Q

            (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                      THE SECURITIES EXCHANGE ACT OF 1934

                       For The Quarter Ended June 30, 1998

                                       OR

            ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                  For The Transition Period From       to      

                        Commission File Number 333-11243

                             CAPITA PREFERRED TRUST




      A DELAWARE                                 I.R.S. EMPLOYER IDENTIFICATION
     BUSINESS TRUST                                        No. 22-3467159

                          c/o AT&T Capital Corporation
               44 Whippany Road, Morristown, New Jersey 07962-1983

                          Telephone Number 973-397-3000

                               ------------------





Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.     YES...x...    NO.......





<PAGE>
 
<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS.

                             CAPITA PREFERRED TRUST
                              STATEMENTS OF INCOME
                             (Dollars in Thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>

                                  For the three months    For the six months
                                     ended June 30,         ended June 30,

                                    1998       1997          1998       1997
                                    ----       ----          ----       ----
<S>                                <C>        <C>           <C>        <C>   
REVENUES - Distributions on
 partnership preferred securities  $4,670     $4,670        $9,340     $9,340
                                   ------     ------         -----     ------
Net income                         $4,670     $4,670        $9,340     $9,340
                                   ======     ======        ======     ======

</TABLE>

The accompanying notes are an integral part of these Financial Statements.




                                       -2-




<PAGE>
 
<PAGE>

                             CAPITA PREFERRED TRUST
                                 BALANCE SHEETS
                             (Dollars in Thousands)


<TABLE>
<CAPTION>

                                                   June 30,            December 31,
                                                     1998                   1997
                                                 (unaudited)
                                                 -----------           ------------
<S>                                                 <C>                 <C>     

ASSET - Limited partnership interest
   in Partnership                                   $206,186            $206,186
                                                    --------            --------
SHAREOWNERS' EQUITY:
   Trust Preferred Securities -
    authorized, issued and outstanding
    8,000,000 shares, $25 liquidation
    value                                            200,000             200,000
   Trust Common Securities -
    $25 liquidation value                              6,186               6,186
   Retained Earnings                                       0                   0
                                                    --------            --------
Total Shareowners' Equity                           $206,186            $206,186
                                                    --------            --------
                                                    --------            --------


</TABLE>

The accompanying notes are an integral part of these Financial Statements.






                                       -3-





<PAGE>
 
<PAGE>

                             CAPITA PREFERRED TRUST
                            STATEMENTS OF CASH FLOWS
                             (Dollars in Thousands)
                                   (Unaudited)


<TABLE>
<CAPTION>

                                               For the six months
                                                 ended June 30,

                                                1998        1997
                                                ----        ----

<S>                                          <C>         <C>     
CASH FLOW FROM OPERATING ACTIVITIES:
Net Income                                   $  9,340    $  9,340
                                              ---------   -------
Net Cash provided by Operating activities       9,340       9,340
                                             ----------   -------


CASH FLOW FROM FINANCING ACTIVITIES:

Payment of distributions                       (9,340)     (9,340)
                                              -------     -------
Net Cash provided by Financing
 activities                                    (9,340)     (9,340)
                                              -------     -------
Net change in cash and cash equivalents             0           0

Cash and cash equivalents at beginning
 of period                                          0           0
                                              -------     -------
Cash and cash equivalents at end
 of period                                   $      0      $    0
                                              =======       =====

</TABLE>


The accompanying notes are an integral part of these Financial Statements.





                                       -4-






<PAGE>
 
<PAGE>

                             CAPITA PREFERRED TRUST
                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

1.  Basis of Presentation

     The accompanying unaudited financial statements have been prepared by
Capita Preferred Trust (the "Trust") pursuant to the rules and regulations of
the Securities and Exchange Commission and, in the opinion of management,
reflect all adjustments, consisting of normal recurring adjustments, necessary
for a fair presentation of the results of operations, financial position and
cash flows for each period shown. The results for interim periods are not
necessarily indicative of financial results for the full year. These unaudited
financial statements should be read in conjunction with the audited Financial
Statements and notes thereto included in the Trust's Annual Report on Form 10-K
for the year ended December 31, 1997.

2.   Financial information of the Partnership

     Summarized financial information for Capita Preferred Funding L.P. (the
"Partnership"), accounted for by the equity method is as follows (dollars in
thousands):

<TABLE>
<CAPTION>

                          At:             At:                 At:
                    June 30, 1998    June 30, 1997     December 31, 1997
                      (unaudited)      (unaudited)

<S>                      <C>            <C>                 <C>   
Current assets           $  2,434       $2,463              $2,434
Noncurrent assets         240,146      240,146             240,146
Partners' Capital        $242,580      242,609            $242,580

</TABLE>

<TABLE>
<CAPTION>

              For the three months ended      For the six months ended
             June 30, 1998  June 30, 1997    June 30, 1998  June 30, 1997
              (unaudited)   (unaudited)       (unaudited)    (unaudited)

<S>             <C>           <C>            <C>            <C>    
Revenues        $5,360        $5,360         $10,722        $10,718
Net Income      $5,360        $5,360         $10,722        $10,718

</TABLE>

3.   1998 Sale of AT&T Capital

     On January 12, 1998, all of AT&T Capital Corporation's (the
"Company") outstanding shares of common stock were purchased by Newcourt Credit
Group Inc., an Ontario corporation ("Newcourt") in a transaction accounted for
under the purchase method of accounting. The Company currently is an indirect
wholly-owned subsidiary of Newcourt. The Trust is a consolidated subsidiary of
the Company.




                                       -5-





<PAGE>
 
<PAGE>

4. Subsequent Event

          On July 27, 1998, an Offer to Purchase and Consent Solicitation (the
"Offer") in connection with the 9.06% Trust Originated Preferred Securities (the
"TOPrS" or "Company-obligated preferred securities") of Capita Preferred Trust,
was announced to all of the holders of record of the TOPrS as of July 20, 1998.
AT&T Capital invited all holders of the TOPrS to tender any and all of their
TOPrS for purchase. In conjunction with the Offer the Company solicited consents
from the holders to amend the Limited Partnership Agreement and the indentures
pursuant to which three debentures (the "Debentures") have been issued by AT&T
Capital and two of its wholly-owned subsidiaries. The proposed amendments will
provide for an early redemption of the Partnership Preferred Securities and
Debentures, which in turn will cause the optional redemption of any and all
TOPrS that have not been tendered in the Offer. Following the successful
consummation of the Offer and the Consent Solicitation in accordance with their
respective terms, there will not be any TOPrS that remain outstanding.






                                       -6-






<PAGE>
 
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS. (Dollars in thousands)

Results of Operations and Changes in Cash Flows

     On June 30, 1998 and June 30, 1997, Capita Preferred Trust (the "Trust")
received quarterly distributions (annual rate of 9.06%) from Capita Preferred
Funding L.P. (the "Partnership") of $4,670 relating to its $206,186 limited
partnership interest in the Partnership. On those same dates, holders of the
Trust securities were paid the required quarterly cash distribution of $4,670
(annual rate of 9.06%).

For the six months ended June 30, 1998 and June 30, 1997, the Trust paid cash
distributions of $9,340 and received cash distributions of $9,340 from the
Partnership.





                                       -7-





<PAGE>
 
<PAGE>

                             CAPITA PREFERRED TRUST
                           PART II - OTHER INFORMATION

Item 6. Exhibits and reports on Form 8-K.

        a)  Exhibits:
             Exhibit Number

               27   Financial Data Schedule

         b) Current Reports on Form 8-K:

               None









                                       -8-





<PAGE>
 
<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                           CAPITA PREFERRED TRUST

                                             GLENN A. VOTEK
                                             ______________
                                         By: Glenn A. Votek
                                             Regular Trustee

August 12, 1998






                                       -9-






<PAGE>
 
<PAGE>

                                  EXHIBIT INDEX

EXHIBITS

<TABLE>
<CAPTION>
  Exhibit
   Number      Description

<S>            <C>

   27.         Financial Data Schedule

</TABLE>





                                      -10-


<PAGE>