In re Couture Hotel Corp.

536 B.R. 712 (2015)

From our private database of 46,100+ case briefs, written and edited by humans—never with AI.

In re Couture Hotel Corp.

United States Bankruptcy Court for the Northern District of Texas
536 B.R. 712 (2015)

Facts

Couture Hotel Corporation (Couture) (debtor) owned and operated two hotels in Texas: a Howard Johnson in Corpus Christi (the Corpus hotel) and a Wyndham Garden Inn in Dallas (the Dallas hotel). In June 2013, Couture obtained a $3.2 million loan from Ability Insurance Company (Ability) (creditor). The Ability loan was secured by a first lien on the Corpus hotel. In July 2013, Couture borrowed $8.87 million from Mansa Capital, LLC (Mansa) (creditor) to finance renovations of the Dallas hotel. The Mansa loan was secured by a first lien on the Dallas hotel and a second lien on the Corpus hotel’s personal property. Couture subsequently began experiencing financial difficulties with respect to the Dallas hotel. Mansa declared a default on its loan and posted the Dallas hotel for foreclosure. Couture filed a chapter 11 bankruptcy petition in October 2014 to prevent the foreclosure. Couture’s chapter 11 plan proposed to pay creditors in Class 2 through Class 9 in full, plus interest, over a 60-month period after the plan’s effective date. The repayment period and terms depended on each creditor’s class. The proposed plan classified Propel Financial Services, LLC (Propel) (creditor) in Class 2. Propel had purchased various ad valorem tax claims on the hotels, and as a result, Ability’s and Mansa’s first liens on the hotels had been primed by (i.e., were subordinate to) Propel’s tax claims. The plan classified Ability in Class 4, which entitled Ability to repayment over three years based on a 25-year amortization. The plan classified Mansa in Class 5, which entitled Mansa to repayment over five years based on a 30-year amortization. Mansa objected to Couture’s proposed plan, arguing that Mansa was similarly situated to other secured creditors, including Propel and Ability, but had been improperly classified separately and treated differently in the plan. The bankruptcy court considered Mansa’s objection and issued a decision.

Rule of Law

Issue

Holding and Reasoning (Houser, J.)

What to do next…

  1. Unlock this case brief with a free (no-commitment) trial membership of Quimbee.

    You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 744,000 law students since 2011. Some law schools—such as Yale, Berkeley, and Northwestern—even subscribe directly to Quimbee for all their law students.

    Unlock this case briefRead our student testimonials
  2. Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.

    Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students.

    Learn about our approachRead more about Quimbee

Here's why 744,000 law students have relied on our case briefs:

  • Written by law professors and practitioners, not other law students. 46,100 briefs, keyed to 987 casebooks. Top-notch customer support.
  • The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
  • Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
  • Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.

Access this case brief for FREE

With a 7-day free trial membership
Here's why 744,000 law students have relied on our case briefs:
  • Reliable - written by law professors and practitioners, not other law students
  • The right length and amount of information - includes the facts, issue, rule of law, holding and reasoning, and any concurrences and dissents
  • Access in your class - works on your mobile and tablet
  • 46,100 briefs - keyed to 987 casebooks
  • Uniform format for every case brief
  • Written in plain English - not in legalese and not just repeating the court's language
  • Massive library of related video lessons - and practice questions
  • Top-notch customer support

Access this case brief for FREE

With a 7-day free trial membership