In Re Jules Meyers Pontiac, Inc., Debtor. Curtis B. Danning, Trustee v. General Motors Acceptance Corp.

Defendant General Motors Acceptance Corp. (GMAC) appeals from a district court order affirming a bankruptcy court judgment in favor of plaintiff Curtis Danning (Trustee) for recovery of excess dividends. We affirm.

The old Bankruptcy Act, now repealed, governs the disposition of this appeal. Under the provisions of that Act, the Trustee could prepare an order for payment of dividends and submit it to the bankruptcy court for review and approval. In the event that an error was made in such an order, section 57(k), 11 U.S.C. § 93 (k), provided the bankruptcy court with summary jurisdiction to reconsider the order and amend it “in whole or in part according to the equities of the case.” If an erroneous dividend had already been paid, section 57 (l) provided the bankruptcy court with summary jurisdiction to order that the dividend previously paid be returned. See In re Madden, 388 F.Supp. 47, 50-51 (D.Idaho 1975).

Contrary to the position taken by Trustee, we do not find that section 57(1) gives the Trustee an absolute right to re- cover an excess dividend. Section 57(k) explicitly requires the bankruptcy court to consider the equities of the particular case when amending an order…