New Bankruptcy Opinion: IN RE DOMUM LOCIS LLC – Bankr. Court, CD California, 2015

In re: Domum Locis LLC, Chapter 11, Debtor.

Case No. 2:14-bk-23301-RK.

United States Bankruptcy Court, C.D. California, Los Angeles Division.

May 22, 2015.

Howard S. Levine, Tania M. Moyron, CYPRESS, LLP Los Angeles, California.

ORDER ON STIPULATION AMONG DEBTOR DOMUM LOCIS, LLC., AND MICHAEL J. KILROY REGARDING PAYMENT OF QUARTERLY FEES TO THE OFFICE OF THE UNITED STATES TRUSTEE

ROBERT KWAN, Bankruptcy Judge.

The Court, having considered that certain Stipulation Among Debtor And Michael J. Kilroy Regarding Payment Of Quarterly Fees To The Office Of The United States Trustee (the “Stipulation”), entered into by and among, Domum Locis, LLC, the above-captioned debtor and debtor in possession, and Michael J. Kilroy (“Kilroy”), the debtor and debtor in possession in a related chapter 11 case, bearing bankruptcy case number 2:15-bk-15708-RK,

IT IS HEREBY ORDERED:

1. The Stipulation is DISAPPROVED without prejudice and not made an order of the court.

2. In only showing that the stipulating parties have agreed to the proposed transactions described in the Stipulation, they have failed to show that the proposed transactions described in the Stipulation to use property of the bankruptcy estate of debtor Michael J. Kilroy (i.e., for one bankruptcy debtor to pay the United States Trustee fees of another bankruptcy debtor) are in the ordinary course of business within the meaning of 11 U.S.C. § 363(b)(1). Unless the stipulating parties show that the transactions are in the ordinary course of business, such transactions using estate property not in the ordinary course of business can only be approved after notice and hearing upon a showing of business justification pursuant to 11 U.S.C. § 363(b)(1). See, e.g., In re Dant & Russell, Inc., 853 F.2d 700, 704-705 (9th Cir. 1988) ; In re Lionel Corp., 722 F.2d 1063, 1071 (2nd Cir. 1983) .

IT IS SO ORDERED.

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