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Opinion 64

Case Name: 

Gen. Elec. Mortg. Corp. v. S. Vill., Inc. (In re S. Vill., Inc.), 25 B.R. 987 (Bankr.D.Utah)

Judge: 
Judge Mabey
Date: 
Dec-30-1982
Case Number(s): 
82PM-0200
Status: 

PUBLISHED

Body: 

Mortgage company that held lien on debtor's shopping mall sought relief from stay "for cause" under 11 U.S.C. § 362(d)(1), alleging lack of adequate protection of the value of its interest in the property. The property, which was worth slightly less than creditor's lien, was not appreciating enough to cover the interest provided under the parties' agreement. Creditor asserted that the stay imposed an "opportunity cost" on it equal to the amount it would earn on its money if it was allowed to foreclose and reinvest, and that amount would exceed the interest under its current contract. Thus, creditor asserted that it was losing the "use value of its money." The court concluded that Congress did not leave creditors without remedies for attrition in values, and had included several provisions that were tailored to solve problems caused by delay, which provisions complement the adequate protection requirement. Therefore, creditor was not entitled to interest as compensation for the opportunity cost of the stay in order to be adequately protected.

Internal Ref: 
Opinion 64
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