Baltimore Marine Industries, Inc.

IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF MARYLAND
In re: 	*
BALTIMORE MARINE 	* 	Case No. 03-80215-JS
INDUSTRIES, INC.,
* 	(Chapter 11)
Debtor
* 	* 	* 	* 	* 	* 	* 	* 	* 	* 	* 	* 	*
MEMORANDUM OPINION DENYING THE MOTION OF
BALTIMORE COUNTY, MARYLAND, FOR ALLOWANCE AND PAYMENT
OF ADMINISTRATIVE EXPENSE CLAIM
Baltimore County, Maryland, filed the instant motion for allowance and
payment of an administrative expense claim against the proceeds of sale of all of the
Chapter 11 debtor’s assets, to which the debtor’s liquidating agent objected. For the
reasons stated, the administrative claim will be disallowed.
FINDINGS OF FACT
On June 11, 2003, the instant Chapter 11 case was filed by Baltimore Marine
Industries, Inc. (“BMI”), a closely-held Delaware corporation that owned and operated
a shipyard located in Sparrows Point, Baltimore County, Maryland. The shipyard
Date signed June 08, 2006
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2
comprised 226 acres with docks, piers, basins, cranes and shops. Among the debtor’s
assets were a variable large, crude, carrier-capable drydock (“VLCC”), and a floating
dock, employed in the multiple repair, conversion and construction of large seagoing
vessels.
The Sparrows Point shipyard was built by Maryland Steel Company in 1889
and bought by Bethlehem Steel Company in 1917. During World War II, the shipyard
was one of the leaders in this nation’s war effort, producing an unprecedented number
of ocean-going vessels, including tankers, cargo and passenger ships for military use.
In those years, the shipyard was one of the State’s largest employers with more than
20,000 workers producing ships on a daily basis around the clock.
Bethlehem Steel sold the shipyard to Veritas Capital of New York for $16
million, at which time BMI was established to operate the facility. 	The company
planned to engage in ship repair but lack of business forced it to layoff hundreds of
employees.
On October 24, 2003, the debtor-in-possession filed a motion for the approval
of the public sale of all of its real and personal property free and clear of liens and
encumbrances. [P. 334]. On October 30, 2003, the motion was granted by order. [P.
343]. 	On November 5, 2003, an 	auction of all estate assets was conducted and
Barletta Willis Investments, LLC (“Barletta Willis”), was the successful buyer for a
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1Maryland Tax-Property Code § 10-402(b) provides:
(b)(1) If a transfer of all personal property or all the stock in
business of a business occurs on or after the date of finality and before
the semiannual date of finality the property is assessed to the transferee
as if the property were escaped property under § 8-417 of this article, if
the transferor or the transferee files with the Department or the
supervisor on or before the October 1 immediately after the date of the
transfer a report, under oath, that contains:
(I) a description of the personal property from the assessment roll;
(ii) the date and manner of transfer;
(iii) the name and address of the transferee;
(iv) the consideration; and
(v) any other information that the Department requires.
(2) If the report is not filed, the transferor and the transferee are
jointly and severally liable for the next taxable year following the
transfer.
(3) This subsection does not apply to any personal property or
stock in business removed from the State before the semiannual date of
finality.
(4) If the transferor of personal property that is transferred under
3
total bid of $11,250,000 [P. 538]. On March 4, 2004, the sale closed. BMI did not
file a liability-transfer report indicating that it had transferred ownership of personal
property during the tax year, pursuant to Maryland Tax-Prop. Code § 10-402(b)
(2004). 1 After the sale, Barletta 	Willis assigned its rights in the property to SPS
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this section has paid the property tax, the transferor may require the
transferee to adjust the property tax with the transferor.
Id.
2Since April 7, 2003, with some exceptions, all bankruptcy cases filed in this district
have been required to be filed electronically, pursuant to Administrative Order No. 03-
02, dated April 4, 2003, which implemented Case Management /Electronic Case
Filing (“CM/ECF”). 	The instant bankruptcy case was initiated by a petition filed
electronically over the Internet, and all subsequent pleadings filed by the parties,
including Baltimore County, were likewise electronically filed..
4
Limited Partnership. The shipyard currently serves as a repair and demolition site for
commercial and military vessels.
Meanwhile, on September 9, 2003, Baltimore County, Maryland, by Deputy
County Attorney John E. Beverungen, Esquire, filed an application for administrative
expenses [P. 289], unrelated to the administrative claim which is the subject of this
opinion. 	This incontestable fact is relevant to the present dispute because Mr.
Beverungen, on behalf of Baltimore County, has filed electronic pleadings and in turn
has received electronic notice of every pleading filed in the instant Chapter 11 case
since September 9, 2003. 2
On April 14, 2004, BMI and the Official Committee of Unsecured Creditors
filed a Joint Plan of Liquidation [P. 702]. With respect to administrative claims, the
plan provided, on page one, as follows:
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1.1. “Administrative Bar Date” means forty-five (45) days after
the Effective Date and is the date by which applications for allowance of
Administrative Expense Claims incurred through the Confirmation Date
must be filed with the Court or be forever barred and discharged. Notice
of confirmation of the Plan shall be deemed sufficient and adequate
notice of the Administrative Bar Date.
Plan, Art. I , § 1.1 [P.702]. The plan further provided, as follows:
8.8. Deadline for Filing Administrative Expense Claims.
Notwithstanding § 503(a) of the Bankruptcy Code, any person or entity
seeking the allowance or payment of an Administrative Expense Claim
under § 503 of the Bankruptcy Code any/or any Professional Person or
firm retained with approval by order of the Court seeking compensation
in this Chapter 11 case pursuant to §§ 330 or 503(b) of the bankruptcy
Code, shall be required to file on or before the Administrative Bar Date
an application for the allowance and/or payment of an Administrative
Expense Claim including, without limitation, an application for the final
compensation of a Professional Person and reimbursement of expenses.
Any such Administrative Expense Claim not filed by the Administrative
Bar Date shall be forever barred and discharged. Objections to any such
application shall be filed on or before a date to be set by the Court. The
provisions of this paragraph are not intended to limit or expand the
ability 	of 	the 	Court 	to 	allow 	the 	payment 	of 	compensation 	to
Professional Persons for services performed after the Confirmation date;
all such compensation remaining subject to approval by the Court.
Pla, Art. VIII, § 8.8. [P. 702].
On June 25, 2004, the Court [Derby, J.], confirmed the plan by order [P. 800].
Pursuant to the plan and the order of confirmation, Alan M. Grochal, Esquire, was
appointed liquidating agent with authority to distribute the sale proceeds to creditors
in accordance with the priorities set forth in the Bankruptcy Code. The record reflects
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3The Joint Plan defined the “Effective Date” as “the later of (a) the fifteenth (15th) day
after an Order of Confirmation becomes final by expiration of the time for appeal
therefrom, and (b) if an appeal is taken, the fifteenth (15th) day after an order on
appeal in favor of confirmation (and all orders on appeal relating to said order)
becomes a final non-appealable Order.” Joint Plan, Art. VIII, § 1.24 [P. 702].
4Oddly enough, the County’s administrative claim was asserted to be based upon 11
U.S.C. § 503(b)(1)(A), which provides, as follows:
6
that Mr. Beverungen timely received a copy of the plan, disclosure statement and the
order of confirmation via electronic notice on the dates they were filed.
No appeal having been filed, the confirmation order became final on July 6,
2004, and, therefore, the effective date of the plan was July 21, 2004.3 Forty-five days
thereafter was September 4, 2004, 45 days after the effective date, but because that
day was a Saturday, and because the following Monday, September 6, was the Labor
Day holiday, the administrative bar date was Tuesday, September 7, 2004.
On October 1, 2004, the Maryland State department of Assessments and
Taxation assessed BMI’s personal property taxes in the amount of $47,712.52, for the
levy period July 1, 2004 through June 30, 2005 [P. 970]. 	See Maryland Tax-Prop.
Code § 10-204.3(f)(1)(iv) (2004).
On November 22, 2004, Baltimore County filed the instant motion, seeking
allowance and payment of an administrative expense claim for BMI’s unpaid personal
property taxes, pursuant to 11 U.S.C. § 503. 4
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§ 503. Allowance of administrative expenses
(b) 	After 	notice 	and 	a 	hearing, 	there 	shall 	be 	allowed
administrative expenses, other than claims allowed under section 502(f)
of this title, including–
(1)(A) the actual, necessary costs and expenses of preserving the
estate including–
(i) wages, salaries, and commissions for services rendered after the
commencement of the case; and
(ii) wages and benefits awarded pursuant to a judicial proceeding
or a proceeding of the National Labor Relations Board as back pay
attributable to any period of time occurring after commencement of the
case under this title, as a result of a violation of Federal or State law by
the debtor, without regard to the time of the occurrence of unlawful
conduct on which such award is based or to whether any services were
rendered, if the court determines that payment of wages and benefits by
reason of the operation of this clause will not substantially increase the
probability of layoff or termination of current employees, or of
nonpayment of domestic support obligations, during the case under this
title[.]
Id. As a claim for unpaid taxes, the County’s claim should have been premised upon
11 U.S.C. § (b)(1)(B)(i), which provides, as follows:
(B) any tax–
` 	(I) incurred by the estate, whether secured or unsecured, including
property taxes for which liability is in rem, in personam, or both, except
a tax of a kind specified in section 507(a)(8) of this title[.]
11 U.S.C. § 503(b)(1)(B)(i).
7
Despite the fact that the County filed its claim more two months after the
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5Section 157(b)(1) and (2)(B) provides:
§ 157. Procedures
(b)(1) Bankruptcy judges may hear and determine all cases under
title 11 and all core proceedings arising under title 11, or arising in a case
under title 11, referred under subsection (a) of this section, and may enter
appropriate orders and judgments, subject to review under section 158
of this title.
(2) Core proceedings include, but are not limited to--
* 	* 	* 	* 	*
(B) allowance or disallowance of claims against the estate or
exemptions from property of the estate, and estimation of claims or
interests for the purposes of confirming a plan under chapter 11, 12, or
13 of title 11 but not the liquidation or estimation of contingent or
unliquidated personal injury tort or wrongful death claims against the
estate for purposes of distribution in a case under title 11;
Id.
8
administrative bar date of September 7, 2004, its motion made no mention of any
reason excusing the lateness of the claim. 	The issue of lateness was raised in the
objection of the liquidating agent, which prompted the County to reply.
CONCLUSIONS OF LAW
This Court has exclusive subject matter jurisdiction to allow or disallow the
administrative claim of Baltimore County, Maryland. 28 U.S.C. § 157(b)(2)(B). 5
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I. THE COUNTY’S CITATION OF THE INCORRECT SUBSECTION OF 11
U.S.C. § 503 WAS NOT FATAL TO ITS ADMINISTRATIVE CLAIM.
The administrative claim at issue is one for unpaid taxes. 	Even though the
County miscited the applicable subsection of the statute, the fact that it correctly cited
Section 503 placed the liquidating agent on notice that the County sought to have its
tax claim accorded administrative priority. Under the circumstances, the Court finds
no prejudice to anyone caused by the County’s error and accordingly will treat the
claim as one based upon the proper subsection of the statute, to wit, Section
503(b)(1)(B).
II. THE CLAIM QUALIFIES FOR ADMINISTRATIVE PRIORITY UNDER
THE BANKRUPTCY CODE.
If the claim had been timely filed, the Court finds that it would have been
entitled to administrative priority. To be entitled to administrative priority treatment,
the tax claim at issue must have arisen as an unsecured postpetition claim against the
debtor’s bankruptcy estate. 	11 U.S.C. § 503(b)(1)(B)(i). 	It will not be accorded
administrative status if the claim arose against the debtor before this case was filed on
June 2003.
The determination of when a claim for personal property tax arises against a
debtor for purposes of determining whether or not it is an administrative claim has
already been decided in this district. In the case of In re Wang Zi Cashmere Products,
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6“‘Date of finality’ means January 1, when assessments become final for the taxable
year next following.” Id. ' 1-101(I).
10
Inc., 202 B.R. 228 (Bankr. D. Md. 1996), Judge Derby held that the “date of finality,”
namely January 1 of the tax year that commences on July 1 next is the operative date
for determining whether a tax claim arose prepetition or postpetition. Md. Code Ann.,
Tax-Prop. §§ 1- 101(I), 8-107(a) (2004).6 This is so, because in Maryland, an owner
of personal property becomes liable for the taxes on the personalty as of the date of
finality, even though the tax itself does not become due and owing until July 1. That
the claim against the owner may be unliquidated and contingent on January 1 is of no
moment, because the definition of “claim” under the Bankruptcy Code means “any
right to payment,” whether liquidated or contingent. 11 U.S.C. § 101(5). 202 B.R.
at 230. Thus, Judge Derby concluded that even though the filing of a debtor’s tax
return was not due until April 15, and the payment of the tax itself not due until July
1, liability for the claim arose on January 1. In Wang Zi, this meant that the claim
arose prepetition and therefore, was not entitled to administrative claim priority. Id.
In the case of In re The Pasta Café Corp., 284 B.R. 564 (Bankr. D. Md. 2002),
building upon the rational of Wang Zi, Judge Keir held that a personal property tax
claim not only arose prepetition and therefore was not entitled to administrative
priority, but because it was also a secured by a statutory lien, it was not even entitled
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7Section 507(a)(8) provides as to priority:
Eighth, allowed unsecured claims of governmental units, only to
the extent that such claims are for–
(A) a tax on or measured by income or gross receipts-
(i) for a taxable year ending on or before the date of the filing of
the petition for which a return, if required, is last due, including
extensions, after three years before the date of the filing of the petition;
(ii) assessed within 240 days, plus any time plus 30 days during
which an offer in compromise with respect to such tax that was made
within 240 days after such assessment was pending, before the date of
the filing of the petition; or
(iii) other than a tax of a kind specified in section 523(a)(1)(B) or
523(a)(1)(C) of this title, not assessed before, but assessable, under
applicable law or by agreement, after, the commencement of the case;
(B) a property tax assessed before the commencement of the case and
last payable without penalty after one year before the date of the filing
of the petition;
(C) a tax required to be collected or withheld and for which the debtor
is liable in whatever capacity;
(D) an employment tax on a wage, salary, or commission of a kind
specified in paragraph (3) of this subsection earned from the debtor
before the date of the filing of the petition, whether or not actually paid
before such date, for which a return is last due, under applicable law or
under any extension, after three years before the date of the filing of the
petition;
11
to eighth-level priority as an unsecured governmental claim, pursuant to 11 U.S.C. §
507(a)(8). 7 The Pasta Café, 284 B.R. at 568.
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(E) an excise tax on–
(i) a transaction occurring before the date of the filing of the
petition for which a return, if required, is last due, under applicable law
or under any extension, after three years before the date of the filing of
the petition; or
(ii) if a return is not required, a transaction occurring during the
three years immediately preceding the date of the filing of the petition;
(F) a customs duty arising out of the importation of merchandise–
(i) entered for consumption within one year before the date of the
filing of the petition;
(ii) covered by an entry liquidated or reliquidated within one year
before the date of the filing of the petition; or
(iii) entered for consumption within four years before the date of
the filing of the petition but unliquidated on such date, if the Secretary
of the Treasury certifies that failure to liquidate such entry was due to an
investigation pending on such date into assessment of antidumping or
countervailing duties or fraud, or if information needed for the proper
appraisement or classification of such merchandise was not available to
the appropriate customs officer before such date; or
(G) a penalty related to a claim of a kind specified in this paragraph and
in compensation for actual pecuniary loss.
11 U.S.C. § 507(a)(8). Quoted in The Pasta Café Corp., 284 B.R. at 567-8, fn. 6.
12
The instant claim for unpaid personal property taxes for the 2004-05 tax year
arose postpetition, that is, after June 11, 2003, on January 1, 2004, the date of finality.
On that date, BMI, the debtor in possession, was the owner of record of its property,
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8 This is an entirely different situation from that faced by debtors in such cases as
Community Development Admin. v. De Souza (In re De Souza), 135 B.R. 793 (Bankr.
D. Md. 1992) 	and Homeside Lending, Inc. v. Denny (In re Denny), 242 B.R. 593
(Bankr. D. Md. 1999), where this Court (Mannes and Keir, J. J.), held that debtors
were dispossessed of their interests in property when the gavel fell at public
foreclosure sales, with no further ability to redeem the property in the bankruptcy
court. In the instant case, the voluntary, court-approved sale did not become final
until settlement because it was at that point that the actual transfer of ownership of the
property occurred. If BMI and Barletta Willis had not reached agreement to close the
sale on March 4, 2004, this Court retained jurisdiction over the property to either
enforce the sale or rescind it.
9The semiannual date of finality. See id. ' 1-101(ff).
13
both real and personal. 	Even though the auction occurred on November 5 of the
preceding year,8 the sale did not close until March 4, well after the date of finality.
The owner of personal property on the date of finality is liable for the personal
property tax, unless otherwise provided. 	Id. § 10-401. 	If personal property is
transferred between January 1 and July 1,9 a liability-transfer report must be filed by
the transferor before October 1 in order to shift the personal property tax liability to
the transferee. Id. at § 10-402(b); In re Wang Zi Cashmere Products, Inc., 202 B.R.
at 232. Cf. In re Reamy, 169 B.R. 352 (Bankr. D. Md. 1994), regarding the difference
in treatment of tax liability when real property is transferred, citing Md. Tax Code §
14-805(a).
In the instant case, BMI filed no such report. Therefore, the bankruptcy estate
and the transferee are jointly and severally liable for the full amount of the personal
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10 11 U.S.C. § 507(a)(8) refers to property taxes solely incurred prepetition and thus
is not applicable to the postpetition property taxes at issue here.
14
property taxes for the period July 1, 2004, through June 30, 2005, first due on July
1, 2004.
Because the debtor’s liability for payment of the personal property tax became
fixed postpetition, and because BMI is jointly and severally liable for its payment, the
tax was incurred by the debtor within the meaning of Section 503.
In the case of In re Merry-Go-Round Enterprises, Inc., 227 B.R. 775 (Bankr.
D. Md. 1998), Judge Derby held that because personal property taxes were “‘incurred
by the estate’ and are not a tax specified in 11 U.S.C. § 507(a)(8),10 they [were]
entitled to treatment as a Chapter 11 administrative claim pursuant to 11 U.S.C. §
503(b)(1)(B)(i).” 	Id., at 784. 	Accord, City of White Plains v. A & S Galleria Real
Estate, Inc. (In re Federated Dep’t Stores, Inc.), 270 F.3d 994, 1006 (6th Cir. 2001);
Perpetual Am. Bank v. District of Columbia (In re Carlisle Court, Inc.), 36 B.R. 209
(Bankr. D. D.C. 1983).
BMI asserted that because the estate no longer possesses the personal property,
it will receive no benefit by the payment of the tax at issue. However, it is obvious
that benefit to the estate is not a prerequisite for the allowance of a tax claim as an
administrative expense under the statute. 	The only requirement for a tax to be
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15
accorded administrative priority under the statute is that it must be incurred by the
bankruptcy estate, and thereby of necessity, be incurred postpetition. 	11 U.S.C. §
503(b)(1)(B)(i); West Virginia State Dep't of Tax & Revenue v. Internal Revenue
Service (In re Columbia Gas Transmission Corp.), 37 F.3d 982, 984 (3rd Cir. 1994)
(If the property tax was incurred by the estate, it must be given priority as an
administrative expense.); Mailman Steam Carpet Cleaning, Inc. v. Salem (In re
Mailman Steam Carpet Cleaning, Inc. (In re Mailman Steam Carpet Cleaning, Inc.),
256 B.R. 240 (Bankr. D. Mass. 2000), reversed on other grounds, sub. nom. Salem v.
Mailman Steam Carpet Cleaning, Inc. (In re Mailman Steam Carpet Cleaning, Inc.),
270 B.R. 82 (BAP 1st Cir. 2001); In re Farris, 205 B.R. 461, 465 (Bankr. E.D. Pa.
1997) (“In order to receive administrative expense treatment, a tax must merely be
incurred by the estate.”); In re Trowbridge, 74 B.R. 484 486 (Bankr. E.D. Pa.
1987)(“Whether a tax is incurred by the estate may well be a different question from
whether a tax benefits the estate or is necessary to the preservation of the estate.”);
Flatau v. Jackson (Matter of Hirsch-Franklin Enterprises, Inc., 63 B.R. 864 (Bankr.
M.D. Ga. 1986); In re Sunset Enterprises, Inc., 49 B.R. 296 (Bankr. W.D. Va.1985)
(postpetition abandoned mine reclamation fees are administrative expenses, as
postpetition taxes, although these fees benefit the public and not the individual mine
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11Bankruptcy Rule 9006(b)(1) states:
[W]hen an act is required or allowed to be done at or within a
specified period by these rules or by a notice given thereunder or by the
order of the court, the court for cause shown may at any time in its
discretion ... on motion made after the expiration of the specified period
permit the act to be done where the failure to act was the result of
excusable neglect.
Fed. R. Bankr. Proc. 9006(b)(1) .
16
operator); Perpetual American Bank v. District of Columbia (In re Carlisle Court,
Inc.), 36 B.R. 209, 217 (Bankr.D.D.C.1983).
III. THE CLAIM WAS NOT TIMELY-FILED AND CANNOT BE ALLOWED
BASED UPON “EXCUSABLE NEGLECT.”
The allowance of an untimely filed claim depends upon a finding that the failure
to file on time was the result of the claimant’s “excusable neglect.” Fed. R. Bankr.
Proc. 9006(b)(1).11 As stated by Judge Mannes in McDow v. Runkle (In re Runkle,
333 B.R. 734, 736 (Bankr. D. Md. 2005):
It is established that Bankruptcy Rule 9006(a) can extend a
deadline established by another bankruptcy rule. “The time-computation
and time-extension provisions of Rule 9006 . .. are generally applicable
to any time requirement found elsewhere in the rules unless expressly
excepted.” 	Pioneer Inv. Services Co. v. Brunswick Assocs. Ltd.
Partnership, 507 U.S. 380, 113 S. Ct. 1489, 1495 n. 4, 123 L. Ed.2d 74
(1993) (emphasis added). See Kontrick v. Ryan, 540 U.S. 443, 124 S. Ct.
906, 913-14, 157 L. Ed.2d 867 (2004); In re Beck, 220 B.R. 573 (Bankr.
D. Md. 1998) (the time limitations set forth in Bankruptcy Rule 4007(c)
are procedural, and not jurisdictional, in nature and therefore are
governed by Bankruptcy Rule 9006(a)).
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17
Id. In Pioneer, the Supreme Court stated:
With regard to determining whether a party's neglect of a deadline
is excusable, we are in substantial agreement with the factors identified
by the Court of Appeals. 	Because Congress has provided no other
guideposts for determining what sorts of neglect will be considered
“excusable,” we conclude that the determination is at bottom an
equitable one, taking account of all relevant circumstances surrounding
the party's omission. These include, as the Court of Appeals found, the
danger of prejudice to the debtor, the length of the delay and its potential
impact on judicial proceedings, the reason for the delay, including
whether it was within the reasonable control of the movant, and whether
the movant acted in good faith.
Pioneer, 507 U.S. at 395, 113 S.Ct. at 1498, 123 L. Ed.2d at 89. (Citations and
footnotes omitted.)
The burden is on the County to prove that it did not timely file its proof of claim
because of excusable neglect. In re Andover Togs, Inc., 231 B.R. 521, 549 (Bankr.
S.D. N.Y. 1999); Maxwell Macmillan Realization Liquidating Trust v. Aboff (In re
Macmillan), 186 B.R. 35, 49 (Bankr. S.D. N.Y.1995). That burden has not been met
because the County had actual notice of the administrative bar date and therefore
cannot demonstrate excusable neglect.
The County blames its delay in filing the claim on the debtor’s failure to file a
liability-transfer report. It claims that it only became aware that the tax was due on
October 1, 2004, when the SDAT generated the tax assessment. However, by reason
of its participation in the bankruptcy case as an electronic filer, the County had actual
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18
and immediate notice of the sale motion, the auction sale on November 5, 2003, the
fact that settlement occurred on March 4, 2004, the confirmation of the plan on June
25, 2004, and the administrative bar date of September 7, 2004.
Ironically, it was the failure of BMI to file the liability-transfer report after
settlement of the sale to Barletta Willis that preserved the liability of the bankruptcy
estate for the payment of the tax. 	The County had actual notice that the sale had
occurred and was on inquiry notice that the liability-transfer report was not filed.
Even before the plan was confirmed on June 25, 2004, the County knew that it had an
administrative claim against the estate for unpaid personal property taxes. When they
were not paid on July 1, presumably by either the transferor or transferee, the taxes
became delinquent. 	However, in light of its knowledge of the events as they
transpired in the bankruptcy case, the County cannot succeed upon the argument that
the first date it became aware that it had an administrative claim against the estate was
October 1, when it received notice of the nonpayment of the tax. In the context of this
case, the County’s ministerial procedures for the collection of the personal property
taxes at issue were trumped by the confirmed plan.
“The most important of the factors identified in Pioneer for determining
whether ‘neglect’ is ‘excusable’ is the reason for the failure to file.” Thompson v. E.I.
DuPont de Nemours & Co., 76 F.3d 530, 534 (4th Cir. 1996). The County’s neglect
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12 Cases after Pioneer have sought to catalog various factors in determining whether
a debtor will be prejudiced by allowing a late claim. “These include the size of the
late claim in relation to the estate, whether a disclosure statement or plan has been
filed or confirmed with knowledge of the existence of the claim, the disruptive effect
that the late filing would have on a plan close to completion or upon the economic
model upon which the plan was formulated and negotiated.” In Re Keene Corp., 188
B.R. 903, 910 (Bankr. S.D. N.Y. 1995). See also In re Enron Corp., 298 B.R. 513,
525 (Bankr. S.D. N.Y. 2003), aff’d, 419 F.3d 115 (2nd Cir. 2005).
19
in not timely filing its claim is not excusable. The auction sale at issue was a major
event, the transfer of an historically important industrial site, namely a 226-acre
shipyard for more than $ 11 million dollars, with dramatic economic implications for
the County and the State of Maryland. 	The County knew about the sale and the
debtor’s liability for the tax well before the administrative bar date.
Because the County has not articulated a sufficient reason for its delay in filing
the claim after the bar date, this Court need not consider the other factors enunciated
in Pioneer, supra.12
WHEREFORE, the motion of Baltimore County, Maryland, for the allowance
and payment of personal property taxes as an administrative expense claim in the
amount of $ 47,712.52 will be DENIED.
ORDER ACCORDINGLY.
Case 03-80215 Doc 1250 Filed 06/08/06 Page 19 of 20

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cc: 	John E. Beverungen, Esquire
Deputy County Attorney
Baltimore County Office of Law
Old Courthouse
400 Washington Ave, 2nd Floor
Towson, Maryland 21204
Alan M. Grochal, Esquire
Tydings and Rosenberg, LLP
100 East Pratt Street, Floor 26
Baltimore, Maryland 21202
Liquidating Agent
Randall L. Hagen, Esquire
Ober, Kaler, Grimes & Shriver
120 E. Baltimore Street
Baltimore, Maryland 21202
Counsel to SPS Limited Partnership
Cameron J. MacDonald, Esquire
Karen H. Moore, Esquire
Dennis J. Shaffer, Esquire
Whiteford, Taylor & Preston, LLP
Seven Saint Paul Street
Baltimore, Maryland 21202
Counsel to Baltimore Marine, Inc.
Douglas S. Draper, Esquire
Heller, Draper, Hayden, Patrick, & Horn, LLC
650 Poydras Street, Suite 2500
New Orleans, Louisiana 70130
Counsel to the Official Committee of Unsecured Creditors
Office of the United States Trustee
United States Courthouse
101 W. Lombard Street, Suite 2625
Baltimore, Maryland 21202
Case 03-80215 Doc 1250 Filed 06/08/06 Page 20 of 20