Cuvrell v. LaLone (In re Talla, Inc.)

MEMORANDUM OPINION AND ORDER

STANLEY B. BERNSTEIN, Bankruptcy Judge.

Introduction:

David A. Cuvrell, the Trustee of Talla, Inc. (Debtor), sued Robert A. LaLone for converting assets of the debtor. The debt- or, Talla, Inc., was a closely-held Michigan corporation. At the time of its incorporation in April of 1977, the defendant, Robert LaLone, and Bobby E. Talsma were the only shareholders.

On May 9,1977 the debtor borrowed $20,-250 from Genesee Merchants Bank and Trust Company. To secure repayment of the loan, the debtor granted to the bank a mortgage on a parcel of real property and a security…