NORTHERN DISTRICT OF CALIFORNIA
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ASSOCIATED VINTAGE GROUP, No. 99-13853
Memorandum on Objection to Claim of The Alary Corporation
Creditor Alary Corporation admits that it received a preferential security interest within 90 days
of the date of the bankruptcy petition in this case. Its only defense to the objection of the disbursing
agent to its claim is that confirmation of the debtor's Chapter 11 plan is res judicata
as to any disputes
which could have been raised before confirmation, so that the objection is barred.
Confirmation of a plan generally bars actions not specifically reserved in the plan or the order
confirming it. In re Kelley
, 199 B.R. 698, 704 (9th
Cir. BAP 1996). While much of Kelley
is dicta, the
essential holding is that a creditor cannot be "sandbagged" into not opposing or even supporting a plan
only to find itself in unanticipated post-confirmation litigation. In this case, page 14 of the plan
specifically reserves in the Disbursing Agent the power to object to claims and avoid transfers and
mentions Alary Corporation by name as being the object of possible post-confirmation litigation.
Accordingly, the court finds that the specificity requirement of Kelley
has been met and the Disbursing
Agent is not barred from asserting his claims against Alary. Preference claims can be prosecuted by
separate adversary proceeding, or as a defense to the transferee's claim. In re America West Airlines,
, 217 F.3d 1161, 1163 (9th
Cir. 2000); In re Badger Lines, Inc.
, 206 B.R. 521, 527 (E.D.Wis.1997).
The parties having stipulated that no other issues exist, the objection to the claim of Alary
Corporation will be sustained. Counsel for the Disbursing Agent shall submit an appropriate form of
Dated: April 16, 2001 ___________________________