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Full title: Objection to confirmation of plan (RE: related document(s)619 Chapter 11 plan) filed by Creditor Denton County. (LeDay, Tara)

Document posted on Mar 8, 2021 in the bankruptcy, 4 pages and 0 tables.

Bankrupt11 Summary (Automatically Generated)

§ DENTON COUNTY, TEXAS’ OBJECTION TO DEBTORS AMENDED JOINT PLAN OF REORGANIZATION FOR STUDIO MOVIE GRILL HOLDINGS, LLC AND JOINTLY ADMINISTERED DEBTORS [ECF 619] NOW COMES The County of Denton, Texas (hereinafter, referred to as “Denton County”) and files this objection to the Amended Joint Plan of Reorganization for Studio Movie Grill Holdings, LLC and Jointly Administered Debtors (the “Plan”) and would respectfully show the Court the following: On January 1 of each year, a tax lien attaches to property to secure the payment of all taxes, penalties, and interest ultimately imposed for the year on the property, whether or not the taxes are imposed in the year the lien attaches.(b) A tax lien on inventory, furniture, equipment, or other personal property is a lien in solido and attaches to all inventory, furniture, equipment, and other personal property that the property owner owns on January 1 of the year the lien attaches or that the property owner subsequently acquires (b) ... a tax lien provided by this chapter takes priority over the claim of any creditor of a person whose property is encumbered by the lien and over the claim of any holder of a lien on property encumbered by the tax lien, whether or not the debt or lien existed before attachment of the tax lien.

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IN THE UNITED STATES BANKRUPTCY COURT FOR THE NORTHERN DISTRICT OF TEXAS DALLAS DIVISION In re: § Chapter 11 § STUDIO MOVIE GRILL HOLDINGS, LLC § Case No. 20-32633 § § Debtors. § DENTON COUNTY, TEXAS’ OBJECTION TO DEBTORS AMENDED JOINT PLAN OF REORGANIZATION FOR STUDIO MOVIE GRILL HOLDINGS, LLC AND JOINTLY ADMINISTERED DEBTORS [ECF 619] NOW COMES The County of Denton, Texas (hereinafter, referred to as “Denton County”) and files this objection to the Amended Joint Plan of Reorganization for Studio Movie Grill Holdings, LLC and Jointly Administered Debtors (the “Plan”) and would respectfully show the Court the following: 1. Denton County, a duly organized governmental unit of the State of Texas, is the holder of a claim for pre and post-petition ad valorem business personal property taxes for the 2020-2021 tax year assessed against the property of the Debtors in the aggregate amount of $25,286.76. 2. Denton County’s pre-petition and post petition claim is secured by unavoidable, first priority, perfected liens on all of the Debtors’ business personal property pursuant to Texas Tax Code Section 32.01 and 32.05 and 11 U.S.C. Section 362(b)(18).1 In re Winn’s Stores, Inc., 177 B.R. 253 (Bankr. W. D. Tex. 1995); Central Appraisal District of Taylor County v. Dixie-Rose Jewels, Inc., 894 S.W.2d 841 (Tex. App. – Eastland 1995).

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These liens arise on January 1 of each tax year along with the property owner’s real and personal liability for the ad valorem taxes and attach to the property by operation of law. Tex. Prop. Tax Code 32.01; 11 U.S.C. Sec. 362(b)(18). Texas Tax Code Section 32.01 provides: (a) On January 1 of each year, a tax lien attaches to property to secure the payment of all taxes, penalties, and interest ultimately imposed for the year on the property, whether or not the taxes are imposed in the year the lien attaches. The lien exists in favor of each taxing unit having power to tax the property. (b) A tax lien on inventory, furniture, equipment, or other personal property is a lien in solido and attaches to all inventory, furniture, equipment, and other personal property that the property owner owns on January 1 of the year the lien attaches or that the property owner subsequently acquires (c) .. (d) The lien under this section is perfected on attachment and ... perfection requires no further action by the taxing unit. 11 U.S.C. Section 362(b)(18) allows the attachment of liens that secure taxes that come due post-petition. (b) ... a tax lien provided by this chapter takes priority over the claim of any creditor of a person whose property is encumbered by the lien and over the claim of any holder of a lien on property encumbered by the tax lien, whether or not the debt or lien existed before attachment of the tax lien.

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3. Denton County objects to confirmation of the Plan to the extent that it does not provide that they retain the liens that secure all base tax, penalties and interest that may accrue on their Secured claims. 4. Denton County objects to the treatment of their claims because the Plan does not specifically provide for retention of their liens against their collateral. 5. Denton County objects to confirmation of the Plan because it does not provide for the payment of interest on their Secured claims. U.S. v. Noland, 517 U.S. 535 (1996). 6. Denton County objects to confirmation of the Plan because it does not provide for when Denton County shall receive payment of their claim. Denton County is still entitled to post-petition pre Effective Date interest and post Effective Date interest at the state statutory rate of 1% per month and 12% per annum, respectively, to the extent that the taxes are not paid in full prior to the delinquency date, pursuant to 11 U.S.C. Sections 506(b), 511 and 1129. WHEREFORE, Denton County objects to the Debtor’s Plan and requests this Court to order appropriate provisions to assure the protection of the position of their secured claims and further request other such relief as is just and proper. Dated: March 9, 2021 Respectfully Submitted, McCREARY, VESELKA, BRAGG & ALLEN, P.C. By: /s/ Tara LeDay Tara LeDay (TX 24106701) P. O. Box 1269 Round Rock, TX 78680-1269 Telephone: (512) 323-3200 Fax: (512) 323-3500 Email: tleday@mvbalaw.com Attorney for Denton County

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CERTIFICATE OF SERVICE I hereby certify that, on March 9, 2021, a true and correct copy of the foregoing document was served by the Electronic Case Filing System for the United States Bankruptcy Court for the Northern District of Texas, Dallas Division. /s/ Tara LeDay Tara LeDay Debtor: Studio Movie Grill Holdings, LLC 12404 Park Central Drive Suite 400N Dallas, TX 75251 Debtors Attorney’s: Jeffery Michael Veteto Law Offices of Frank J. Wright, PLLC 2323 Ross Avenue, Suite 730 Dallas, TX 75201 U.S. Trustee: Meredyth Kippes United States Trustee 1100 Commerce St. Rm. 976 Dallas, TX 75242