Opinion ID: 1507907
Heading Depth: 1
Heading Rank: 8

Heading: Interest Allowance to 73s

Text: The 73s, but not the 78s, object to the allowance made them in compensation for the interest lost by them as a result of their exchange of FIDs under the Recap Plan. They argue that if they are restored to the position of holders of FIDs, which they exchanged for their present securities, they should be allowed the full amount of the difference between the interest paid to FIDs, and that paid to 73s, during the years since the exchanges were made. The objection is not sound. In the first place, it is doubtful whether the 73s, if issued under a plan that was fraudulent as to FIDs not making the exchange, and as to other creditors of Ageco, would be entitled to any compensation for lost interest, as against such creditors. First Nat. Bank v. Flershem, 290 U.S. 504, 521, 54 S.Ct. 298, 78 L.Ed. 465, 90 A.L.R. 391. In the second place, even if they ought to be allowed interest, it would be reasonable to hold that the claim should not have been allowed on a priority basis, but only on the basis of a general claim for the difference between the interest which they received from Agecorp and such interest as they would have received if they had not exchanged FIDs for 73s. If either of these doubtful matters were resolved against them they would receive much less than they have been allowed under the Plan.