Delaware Judge Says Trustee Not Obligated to Obtain Best Price at Auction

Rochelle’s Daily Wire posted an interesting article the other day about a Chapter 7 Bankruptcy matter out of the Virgin Islands.

Here is a snippet: “Bankruptcy Judge Mary F. Walrath penned an opinion that reads like a treatise laying out the limited circumstances when a trustee can become personally liable for selling property at a low price. Although she sits in Delaware, Judge Walrath was presiding over a case from the Virgin Islands involving a formerly rich man in chapter 7. The dispute involved a painting by impressionist painter Camille Pissarro that the debtor had purchased for $500,000. The trustee first got permission to auction the painting at Christie’s Inc. The gallery held the painting for three years and finally decided not to hold an auction because it might not be able to convey good title since the work may have been stolen by the Nazis in the 1940s. Christie’s nonetheless estimated the painting’s value between $70,000 and $90,000. With court authorization, the trustee hired a second auctioneer, who sold the painting for $75,000. The new auctioneer disclosed the problem with provenance to all potential purchasers, although the trustee did not disclose the provenance questions to the court along with the retention application….”

You can read the rest of the article here.

The case citation is Carroll v. Prosser (In re Prosser), 11-3005.

 

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