Opinion ID: 16726
Heading Depth: 3
Heading Rank: 1

Heading: Terms of the trust

Text: 10 The district court found that the trust ended, by its own terms, on July 15, 1997. At the onset, it is crucial to note the purpose of the trust. While MCORP was in Chapter 11, and had been since 1989, the trust, established in July 1994, was specifically designed to effectuate the rapid liquidation of the MCORP assets and distribution of them to the creditors. 1 In line with this expectation, the trust instrument provides The Trust shall terminate on the earlier of (1) the third anniversary of the Effective Date or (2) the date as of which substantially all of its assets have been reduced to Cash and distributed. 2 This language amounts to a clear and express statement that the trust would terminate on the third anniversary of its effective date--i.e. on July 14, 1997--notwithstanding that by that time substantially all of its assets had not been reduced to cash or distributed. 11 Goldin argues that the second sentence of this section, [i]f any assets of the Trust remain after termination, they shall be deposited with the Clerk of the Bankruptcy Court ... unless the Trust Board and General Bank Trust Board direct, and the Bankruptcy Court approves, after notice and a hearing, an alternative procedure, provides an extension mechanism. However, this alternative procedure provision refers to the establishment of an alternative to the disposition of residual assets after the termination of the trust. It does not envision extension of the trust itself. Indeed, the establishment of a procedure for distribution of residual assets provides further evidence that the trust was intended to terminate automatically. We find the language of the trust instrument unambiguous, and we agree with the court below that the trust terminated on July 15, 1997.