In re Appalachian Fuels

(Bankr. E.D. Ky. Nov. 19, 2014)

The bankruptcy court overrules the trustee’s objection to the state agency creditor’s application for an administrative expense claim for expenses to correct environmental violations. The state agency sought administrative expense status for its estimate of such expenses to be incurred in the future. The court considers whether the claims were “actual and necessary” for preservation of the estate, and ultimately concludes that they are. The court orders that the claim be paid in small amounts as needed and that a reserve of funds be maintained for the estimated future costs.

At the end of the opinion, in “A Final Mea Culpa,” the court recognizes that the plan confirmed in this case could be interpreted in a way that violates § 1129(a). The court states that it expects an appeal will follow. Opinion below.

2014-11-19 – in re appalachian fuels

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