In Re Allen

183 Bankr. 519 (1994)

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In Re Allen

United States Bankruptcy Court for the Northern District of Illinois
183 Bankr. 519 (1994)

  • Written by Rose VanHofwegen, JD

Facts

Trucking company TSC Express Co. (TSC) (debtor) agreed to transport goods for Krueger Ringier, Inc. (KRI) (defendant) at a rate lower than the tariffs set by the Interstate Commerce Commission. KRI paid TSC the agreed rates, but TSC never filed a copy of the negotiated price agreement with the commission as required by federal law. Two years later, TSC filed for bankruptcy under Chapter 7. Bankruptcy trustee L. Lou Allen (plaintiff) audited all of TSC’s freight bills for the three years prior to filing and billed KRI for $12,229 worth of undercharges. KRI refused to pay, and the trustee moved for summary judgment seeking to recover the undercharges plus interest and costs.

Rule of Law

Issue

Holding and Reasoning (Coar, J.)

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Casebooks

Bankruptcy

Key Terms

  • Ipso factoLatin for "by the fact itself," meaning through the effect of a fact or act. In bankruptcy law, an ipso facto clause is a contract term that sets forth the consequences of a party’s entrance into bankruptcy, such as automatic default.

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