Bankers Life Insurance Company of Nebraska v. Alyucan Interstate Corp. (In re Alyucan Interstate Corp.)
United States Bankruptcy Court for the District of Utah
12 B.R. 803 (1981)
Alyucan Interstate Corporation (Alyucan) (debtor) filed for Chapter 11 bankruptcy. Bankers Life Insurance Company of Nebraska (Bankers Life) (creditor) held a lien on Alyucan’s real property that secured a debt with a principal amount of $1,220,000. Bankers Life sought relief under 11 U.S.C. § 362(d) from the Bankruptcy Code’s automatic stay of certain collection activities, alleging that the stay should be lifted because Bankers Life’s property interest was not adequately protected. The bankruptcy court determined that the value of the real property was $1,425,000 and the amount of the debt, including interest, was $1,330,761. The court thus found that there was a $127,774 equity cushion (i.e., the amount by which the value of the collateral exceeds the amount of the claim). The evidence before the court indicated that the equity cushion was decreasing and would likely dissipate within a year while the debt went unpaid and interest accrued.
Rule of Law
Holding and Reasoning (Mabey, J.)
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