J.B.C. Lockwood, Jr., Successor to Sanford M. Sage, Trustee in Bankruptcy of Emerald Properties, Inc. v. The Wolf Corporation, a Delaware Corporation

The Wolf Corporation (Wolf) appeals from summary judgment in favor of Lockwood (Trustee), the successor trustee in bankruptcy of Emerald Properties, Inc. (Emerald), enforcing a settlement agreement between Wolf and Emerald made in connection with bankruptcy proceedings. The district court also held that Wolf’s counterclaim against the bankrupt estate was barred by the statue of limitations as well as by the terms of the settlement agreement. We affirm.

I. Factual Background

Emerald was indebted to Wolf, a realty investment corporation, for $705,000. Albert N. Ballard owed $200,000 to Emerald. To satisfy the debt, Ballard transferred his interests in stock of Westpoint Holding Pty., Ltd. and Australian real property to Lawrence E. McCombs, an officer of Emerald. McCombs assumed Ballard’s obligations with respect to the real property. McCombs in turn gave a note for $392,051, plus 7% interest, to Emerald to satisfy Ballard’s obligation. The note was due December 31,1971, or on demand, and was secured by McCombs’ interest (acquired from Ballard) in the Westpoint stock and the Australian real estate.

On January 7,1972 Emerald assigned the McCombs note to Wolf in “partial…