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In re In re Chicago, Milwaukee, St. Paul & Pac. R.R.

ELR Citation: 23 ELR 21352
Nos. Nos. 92-3713, -3790, 3 F.3d 200/37 ERC 1561/(7th Cir., 08/18/1993) Postpetition claims bar

The court holds that a company's indemnification claims for state and federal liability incurred for the cleanup of pollution on property it purchased from a bankruptcy trustee are barred by the debtor's reorganization plan's bar date for postpetition claims. Although the company argued that it did not have sufficient knowledge of its liability under the Comprehensive Environmental Response, Compensation, and Liability Act before the consummation date to require it to file a proof of claim under §77(b) of the Bankruptcy Act of 1898, the court holds that the company had constructive knowledge of the potential environmental claims regarding the property. The property was included in a Superfund site, an engineering report described contamination at the site and was available to the company, the company knew of U.S. Environmental Protection Agency investigations at the site, and company engineers had noted that the property might require extensive cleanup. The court remands the case to the district court to determine, for the purpose of discerning liability under the Washington Model Toxics Control Act, what liabilities existed at the bar date by virtue of Washington State statutes then in effect.

Counsel for Plaintiff-Appellant
Raymond Groble
Ross & Hardies
150 N. Michigan Ave., Ste. 2500, Chicago IL 60601
(312) 558-1000

Counsel for Defendant-Appellee
Robert Wheeler
Oppenheimer, Wolff & Donnelly
Two Prudential Plaza
180 N. Stetson Ave., 45th Fl., Chicago IL 60601
(312) 616-1800

Before COFFEY and MANION, Circuit Judges, and ALDISERT, Senior Circuit Judge.*