Opinion ID: 2083741
Heading Depth: 1
Heading Rank: 4

Heading: claims process

Text: In accordance with §§ 88-547 and 88-530, on March 19, 2002, the PSC entered an order directing the liquidation of AEI's grain, with the proceeds from that liquidation and a warehouse security bond to be distributed to claimants deemed qualified as of March 11. Section 88-547 provides, inter alia, as follows: If the [PSC] determines that a shortage of grain exists [or] if a license is surrendered ... the [PSC] may close the warehouse and do one or more of the following: (1) Take title to all grain stored in the warehouse at that time in trust for distribution on a pro rata basis to all valid owners, depositors, or storers of grain who are holders of evidence of ownership of grain.... Such distribution may be made in grain or in proceeds from the sale of grain; [and] (2) After notice and hearing (a) determine the value of the shortage and the pro rata loss to each owner, depositor, or storer of grain, (b) require all or part of the warehouse security to be forfeited to the [PSC], and (c) distribute the security proceeds on such pro rata basis[.] Although not defined in the statute, a Depositor, Storer, and/or Owner is defined in the PSC's grain warehouse rules and regulations as [a]ny person who has grain stored with a warehouseman.... Owner does not include mortgagee or pledgee. 291 Neb. Admin. Code, ch. 8, § 001.01D (2002). Section 88-530 reads, in relevant part, that the security required of a licensed warehouse shall run to the State of Nebraska for the benefit of each person who stores grain in such warehouse. Pursuant to the March 19, 2002, order, the PSC required parties who claimed to be either an owner, depositor, or storer of grain with AEI on March 11 to file their claims by May 23. A hearing on such claims was set for May 30. Notice of the claims deadline and hearing date was published in several newspapers and sent to potential claimants identified through the PSC's March inspection. On May 6, 2002, AEI filed chapter 7 bankruptcy proceedings. On May 22, the PSC entered into a stipulation in the bankruptcy case providing for the bankruptcy estate's abandonment of the grain inventories and the grain warehouse bond in the amount of $433,700. The bankruptcy court approved the stipulation. Thereafter, pursuant to its statutory authority, the PSC liquidated AEI's grain inventories. The net proceeds from the liquidation of the grain inventories totaled $649,559.42. In addition, AEI's grain warehouse bond of $433,700 was available for distribution. Thus, a total of $1,083,259.42 (the proceeds) was available for pro rata distribution by the PSC to approved claimants.