O'Neil v. Shipman (In re Pratt & Whitney Co.)

MEMORANDUM OF DECISION

ROBERT L. KRECHEVSKY, Chief Judge.

I

ISSUE

One day prior to filing a bankruptcy petition, a corporate debtor forwarded $100,000 to an escrow agent for the purpose of paying lawyers thereafter retained by the debtor’s officers and directors if third parties sued them because of their status as the debtor’s officers and directors. At issue in this proceeding is the question of entitlement to the present balance of the $100,000 as between the debtor’s estate and the escrow agent. The matter has been submitted upon a stipulation of facts, documentary evidence and after a short…