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Callahan, Jr., Trustee v. Lambert (In re Lambert Oil Co., Inc.) (Case No. 03-01183; A.P. No. 05-07040) 02/16/2006

The court held that a loan made by the Debtor corporation to its sole shareholder for the purpose of acquiring another corporation, which was merged into the Debtor, was a personal loan.  The sole shareholder also owed pre-judgment interest on the amount owed to the Debtor from the time the Debtor became insolvent.  The sole shareholder could, however, setoff his right to reimbursement for partial payment on a debt he guaranteed for the Debtor. 

Date: 
Thursday, February 16, 2006
Category: 
Adversary Proceedings
Interest
Property of the Estate
Chapter: 
7