Case No. 02 B49672, (Jointly Administered).United States Bankruptcy Court, N.D. Illinois, Eastern Division.
June 17, 2003.
Roger Higgins, James H.M. Sprayregen, P.C., Richard L. Wynne, Anup Sathy, Dryden J. Liddle, Kirkland Ellis, Chicago, IL, Counsel for the Debtors and Debtors-In-Possession.
James G. Lapeze, Thompson Knight LLP, Houston, TX, Counsel for the Plaintiffs.
STIPULATION AND ORDER RESOLVING ELLEN VRETTOS, CHARLES DEPRIEST AND SANDRA MILLER’S MOTION FOR RELIEF FROM AUTOMATIC STAY
CAROL A. DOYLE, United States Bankruptcy Magistrate Judge
Upon consideration of the Motion for Relief from the Automatic Stay (the “Motion”) to permit Ellen Vrettos and Charles DePriest, each individually and as representative of the estate of Michael Todd DePriest, and as representative of the estate and as next friend of Jennifer Rhea Ballew DePriest, Molly Anamarie DePriest, Michael Stewart DePriest, and Sandra Miller, individually and as representative of the estate and as next friend of Jennifer Rhea Ballew DePriest, Molly Anamarie DePriest, and Michael Stewart DePriest (“Plaintiffs”), to proceed with an action in the 12th Judicial District Court in Leon County, Texas, Cause No. 0-02-560 (the “DePriest Action”),[2] against debtor and debtor-in-possession Conseco Finance Servicing Corp (“CFSC”) and other unrelated non-debtor defendants; the undersigned parties agreeing to and the Court finding that due and proper opportunity for a hearing on the Motion having been appropriate in the particular circumstances; it appearing that sufficient cause exists for granting the requested relief on a limited basis; each of the undersigned parties hereto consenting to the jurisdiction of this Court’s authority to finally resolve all matters set forth herein; and the relief requested in the Motion is in the best interests of the CFC Debtors, their estates and Plaintiffs; and the parties having reached an amicable resolution as memorialized herein;
THE PARTIES HEREBY AGREE AND STIPULATE AS FOLLOWS:
A. On December 17, 2002 (the “Initial Petition Date”), the Initial Debtors filed their voluntary petitions for relief under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the Northern District of Illinois (the “Bankruptcy Court”). On February 3, 2003 (the “CFC Subsidiary Petition Date”), the CPC Subsidiary Debtors filed their voluntary petitions for relief wider chapter 11 of the Bankruptcy Code (collectively, the “Chapter 11 Cases”).
B. On May 9, 2003, Plaintiffs, by and through their counsel, filed a Motion for relief from the stay in these Chapter 11 Cases pursuant to section 362(d) of the Bankruptcy Code to enable Plaintiffs to proceed with the DePriest Action against CFSC and certain unrelated nondebtor defendants in the District Court in Leon Country, Texas (the “District Court”).
C. On January 23, 2003, the CFC Debtors filed a Suggestion of Bankruptcy with the District Court notifying all parties to the DePriest Action, including Plaintiffs, that the filing of these Chapter 11 Cases operates as a stay pursuant to section 362(a) of the Bankruptcy Code of the continuation of the DePriest Action.
D. The CFC Debtors and Plaintiffs, by and through their attorneys, agree that the automatic stay should be modified on a limited basis for cause pursuant to section 362(d)(1) of the Bankruptcy Code only to enable the DePriest Action to continue against CFSC and certain unrelated defendants subject to the condition that Plaintiffs shall be barred from collecting or recovering from CFSC or any of its direct or indirect subsidiaries or affiliates any judgment for money damages, fees and costs. Furthermore, Plaintiffs hereby agree that the collection of any such judgment is solely limited to insurance proceeds.
E. The parties hereby understand and agree that neither the making of this Stipulation, nor anything contained herein, shall be construed or considered in any way to be an admission of liability, guilt, wrongdoing or noncompliance with federal, state or local law, statute, order or regulation, the Bankruptcy Code, tortious act, breach of contract or violation of common law, or any other wrongdoing whatsoever.
F. This Stipulation may be executed in counterparts and by facsimile, and all such counterparts shall constitute one stipulation.
G. This Stipulation constitutes the entire agreement between the parties with respect to the subject matter hereof. No prior or contemporaneous agreement may be used to alter the terms of the Stipulation.
H. This Stipulation may be modified only in writing and signed by the party to be charged with such modification.
I. The signatories to this Stipulation represent and warrant that they have been duly authorized to execute this Stipulation.
J. This Stipulation shall inure to the benefit of and be binding upon Plaintiffs and their successors and assigns as well as CFSC and any Chapter 11 or Chapter 7 Trustee appointed in these Chapter 11 Cases,
K. This Stipulation is subject to the approval of the Banruptcy Court. The parties agree to use reasonable efforts to obtain the approval of the Bankruptcy Court as quickly as possible.
L. In the event the Bankruptcy Court declines to approve this Stipulation, neither this Stipulation nor any part there of may be used by any party for any purpose, except to enforce this provision.
Wherefore, good cause appearing, IT IS HEREBY ORDERED THAT:
1. The Motion is GRANTED as set forth herein.
2. Effective upon the date of entry of this Order, the automatic stay shall be modified on a limited basis in accordance with the terms set forth herein, to allow Plaintiffs to continue the DePriest Action against CFSC.
3. Plaintiffs are barred from collecting or recovering from CFSC or any of its debtor or nondebtor subsidiaries or affiliates, successors or assigns, any portion or amount of any judgement, attorneys fees or costs that may be awarded in the DePriest Action.
4. In collecting any judgment that may be awarded to Plaintiffs in the DePriest Action, Plaintiffs are limited solely to the insurance proceeds that provide coverage to CFSC and/or any of its debtor or nondebtor direct or indirect subsidiaries or affiliates.
5. Plaintiffs are not entitled to collect or recover from CFSC or any of its related entities any portion or amount of any judgment, fees or costs that may be awarded in the DePriest Action that exceeds the amount of insurance coverage provided to CFSC or any of its related entities.
6. The Bankruptcy Court shall retain jurisdiction to hear and determine all matters arising from or related to the implementation of this Order.
7. Notwithstanding the possible applicability of Federal Rules of Bankruptcy Procedure 6004(g), 7062, 9014, or otherwise, the terms and conditions of this Order shall be immediately effective and enforceable upon its entry.
8. The parties waive any rights that they might have had under Federal Rules of Bankruptcy Procedure 8001, 8002, 8003 to appeal this Order provided that the Order is entered substantially in the form of the Order submitted herein.
9. This Order is a complete and final resolution of Plaintiff’s Motion.