In Re Kold Kist Brands, Inc.

Sedlachek v. National Bank of Long Beach (In Re Kold Kist Brands, Inc.)

Good Law

1993 WL 328515·158 B.R. 175·29 Collier Bankr. Cas. 2d 1169·1993 U.S. Dist. LEXIS 15473

United States District Court, Central District of CaliforniaJuly 19, 1993CV 93-1578 DTCalifornia2,610 words

Opinion

Tevrizian, J.

ORDER AFFIRMING THE BANKRUPTCY COURT’S ORDER REMANDING THE ADVERSARY PROCEEDING

Background

Kold Kist Brands, Inc. (“Kold Kist”) commenced bankruptcy proceedings by filing a petition under Chapter 11 of the United States Bankruptcy Code on October 5, 1992 (the “Bankruptcy Action”). Kold Kist’s shareholders include Raymond J. Sedlachek and his wife Elizabeth Sedlachek (the “Sedlacheks”). The Sedlacheks also serve as trustees of Sedlachek Living Trust dated March 13, 1984 (the “Trust”) (the Sedlacheks and the Trust collectively referred to as “Appellants”). The Trust is not a shareholder of Kold Kist.

On October 27, 1992, shortly after the Bankruptcy Action began, National Bank of Long Beach (the “Bank” or “Appellee”) commenced a collection action (the “State Action”) by filing a Complaint in the Superior Court of the State of California for the County of Los Angeles, against each of the Sedlacheks and also against the Trust by suing the Sedlacheks in their capacities as trustees of the Trust. The Bank filed the State Action to collect and recover on two separate and independent debts. The first debt consisted of a $350,000 note (the “Note”) given to the Bank by the Trust, which…

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