§ 507

Howard Delivery Serv. v. Zurich Am. Ins. Co.

Petitioner employer filed a chapter 11 bankruptcy petition. Respondent insurer filed an unsecured creditor's claim, seeking priority status under 11 U.S.C. § 507(a)(5) for unpaid workers'compensation premiums. The bankruptcy court denied priority status to the insurer's claim, and the district court affirmed. The Fourth Circuit reversed. Certiorari was granted.
Ruling: 
Court deemed that unpaid workers'compensation insurance premiums were not entitled to priority status under section 507(a)(5) because such premiums were classified more as liability insurance premiums than as employee benefit plan contributions.
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In re Build Tech Sys.

Insurer filed a claim for unpaid insurance premiums. The insurer alleged that the claim was for health insurance benefits provided to the debtor's employees, and thus was entitled to priority status under 11 U.S.C. § 507(a)(4) as a contribution to an employee benefit plan. The chapter 7 trustee objected on the basis that the asserted claim was not eligible for priority claim status.
Ruling: 
Insurer was entitled to priority claim status for its claim for unpaid premiums for health insurance benefits provided to the debtor's employees.
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In re Albion Health Servs.

A bankruptcy debtor, a not-for-profit corporation that owned a hospital, ceased operation before filing its bankruptcy petition and its former employees received unemployment compensation from the state of Michigan. The state asserted a claim for reimbursement of the unemployment benefits which it paid, and the trustee objected to the allowance of the claim as a tax priority under 11 U.S.C. § 507(a)(8). The trustee moved for summary judgment.
Ruling: 
Court ruled that a state's claim for reimbursement of unemployment benefits to the debtor's former employees was not an excise tax entitled to priority.
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In re Garden Ridge Corp.

Before the court in a chapter 11 matter was debtor's Seventh Omnibus Objection (Substantive) to Administrative and Priority Claims Pursuant to 11 U.S.C. §§ 105 and 502(b) and Fed. R. Bankr. P. 3001, 3003, 3007, and two responses thereto filed by claimants, former employees of debtor.
Ruling: 
Claims by debtor's two former employees were deemed allowed as unsecured priority claims since their employment ended during the 90-day priority period and the right to receive severance payments was earned no earlier than on termination.
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In re Kuhn

After the debtor filed a chapter 7 petition for bankruptcy, the court appointed the trustee and authorized the trustee to act as his own attorney. The trustee objected to the debtor's motion under 11 U.S.C. § 706(a) to convert her case to a chapter 13 case. When the court converted the debtor's case to a chapter 13 case, the trustee filed a claim under 11 U.S.C. § 507(a)(1) for attorney's fees and expenses. The debtor objected to the claim.
Ruling: 
A chapter 7 trustee was allowed to make a claim for reasonable compensation and expenses reimbursement for work performed as an attorney prior to a conversion to chapter 13.
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