Court Opinion

ID: 8890902
Source: CourtListenerOpinion
Date Created: 2022-11-26 23:12:22.699427+00
Date Added: 2024-06-11T17:07:12.682346
License: Public Domain

SEITZ, Chief Judge
(concurring).
I think the panel’s opinion can be read to mean that under the circumstances, the district court lacked statutory authority to act on the trustees’ petition. Because that inference can be drawn, I desire to make clear that I do not view the appeal and, therefore, this petition for rehearing in banc as presenting a question of the statutory authority of the district court to consider and approve the trustees’ petition.
In my view § 77(o) gives a trustee authority to file a petition seeking a private sale of any of the debtor’s property. It seems to me to follow that the district court has authority to pass on such a petition without first referring it to the ICC as part of a plan of reorganization. This construction is compatible with §§ 77(d) and (é) because of the requirement in § (o) that the trustee must allege, and of course the district court must find, that such a sale is “in the interest of the debtor’s estate and of ultimate reorganization.” (emphasis supplied)
Given the numerous and varied problems arising in this, and other, reorganizations, a formulation in terms of “lack of authority” is highly undesirable. It removes the flexibility and unnecessarily rigidities the bounds within which the district court must act. On the other hand, an interpretation which recognizes the “authority” of the district court to act but focuses upon its use of that authority retains the flexibility of the statute while permitting the courts to apply traditional standards in administering it.
The issue here then, as I see it, is whether the district court erred in approving the determinations of the trustees that the sales of. these properties were: (1) in the interest of the debtor’s estate; and (2) in the interest of the ultimate reorganization. In resolving this issue, the district court was called upon to exercise its discretion. In consequence, the court of appeals was required to find an abuse of discretion by the district court before it could reverse.
The factors relied upon by the panel of the court form a sound basis for the conclusion that at this stage it was not consistent with a sound exercise of discretion for the district court to approve the trustees’ recommendation that the sales were in the interest of the ultimate reorganization of the debtor. I therefore do not seek rehearing in banc.
Circuit Judges VAN DUSEN and AL-DISERT join in the foregoing opinion.