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In re In re Mattiace Indus.

Citation: 17 ELR 21292
No. No. 886-60499-18, 76 Bankr. 44/(Bankr. E.D.N.Y., 07/31/1987)

The court holds that a Chapter 11 bankruptcy petition should be dismissed where the debtor in possession maintains a hazardous waste site in violation of state environmental laws and does not have funds to implement cleanup. The court declines to appoint a trustee in the case, expressing concern that the scope of liability for trustees in hazardous waste cases remains potentially unlimited. The court holds that dismissal of the petition is appropriate pursuant to 11 U.S.C. § 1112(b) of the Bankruptcy Code. The state of New York is a party in interest and thus may make the request for dismissal. Dismissal is appropriate since the debtor poses a serious health hazard to the surrounding community by its unabated contamination of the soil and groundwater. The evidence has also established that the debtor is unable to effectuate a reorganization plan, and the debtor has not filed a plan by the court-ordered deadline of October 6, 1986.

[A related decision is published at 17 ELR 21004.]

Counsel for Debtors
Angel & Frankel, P.C.
366 Madison Ave., New York NY 10017-3191
(212) 286-0100

Counsel for State
Louise A. Halper, Ass't Attorney General
New York State Department of Law
Environmental Protection Bureau, Rm. 26-112, 120 Broadway, New York NY 10271
(212) 341-2070