982 N.E.2d 1026
Ind. Ct. App.2013Background
- Receivership of eight King entities; Receiver eliminated Crown's inter-company accounts before conveying Crown to George per 2006 order and Plan approvals.
- Term Sheet (Feb 22, 2005) envisioned Crown conveyance to George free and clear of claims, with unpaid taxes and third-party creditors retained; distributed assets via Liquidation Agreement to follow.
- Trial court adopted Receiver’s Plans of Distribution (2006/2008) to implement the Term Sheet to the greatest extent practicable.
- Receiver funded taxes owed by receivership entities using Crown assets, recording inter-company receivables/payables to reflect intercompany transfers.
- Plan of Distribution (Nov 25, 2008) required payment of Receiver’s legal fees from an unsuccessful disputant’s distributive share; court approved the Plan and later final accounting.
- George appealed and dismissal, then challenged final accounting/Plan (2012); court affirmed elimination of Crown’s inter-company receivables, World tax treatment, appellate fees allocation, and release of the Receiver.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Crown’s intercompany accounts receivable could be eliminated before transfer to George | King | King | No abuse; elimination justified by Plan and Term Sheet; assets conveyed free of such claims. |
| Whether World tax payments should be reimbursed | King | King | Not required; tax effects offset under Plan; World to receive shares as of conveyance. |
| Whether Receiver’s appellate legal fees could be charged to George | King | King | Proper under Plan; unsuccessful disputant bears fees irrespective of merits. |
| Whether the Receiver could be released from liability for actions during the receivership | King | King | Proper release; no clear evidence of actionable misconduct. |
Key Cases Cited
- Brock v. Rudug, 119 N.E. 491 (Ind. Ct. App. 1918) (receiver is under court control; assets are receivership assets)
- Lecompte v. Wilson, 15 N.E.2d 97 (Ind. 1938) (receivership assets governed by court order; Plan controls distribution)
- City of Lawrenceburg v. Milestone Contractors, L.P., 809 N.E.2d 879 (Ind. Ct. App. 2004) (contract interpretation; harmonization of provisions)
- Briles v. Wausau Ins. Co., 858 N.E.2d 208 (Ind. Ct. App. 2006) (two-tiered standard of review for findings of fact and conclusions of law)
- King v. King, 924 N.E.2d 227 (Ind. Ct. App. 2010) (unpublished; pertains to prior appeal dismissal)