Westcrowns, Inc.

1This is a pre-BAPCPA (Bankruptcy Abuse Prevention and Consumer Protection Act of
2005) case because the debtor filed bankruptcy on June 24, 2005. All statutory references are to
the pre-BAPCPA version of the Bankruptcy Code.
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF NORTH CAROLINA
WILMINGTON DIVISION
IN RE:
WESTCROWNS, INC.,
Debtors. 	Case No. 05-04887-8-JRL
Chapter 7
____________________________________________________________________________
ORDER
This case is before the court on the trustee’s objection to the claim of Geoffrey Card. On
April 23, 2008, the court conducted a hearing on this matter in Wilmington, North Carolina.
On June 24, 2005, the debtor, Westcrowns, Inc., filed a voluntary petition under Chapter 7
of the Bankruptcy Code. 1 The debtor is a corporation that engaged in the business of selling and
distributing glass used in the construction industry. On August 2, 2005, Geoffrey Card, the former
president of the debtor, filed a proof of claim in the amount of $6,923.00 for twenty days of vacation
pay for the term April 1, 2004 to March 31, 2005. The proof of claim lists Mr. Card’s claim as a
Section 507(a) priority claim. The trustee objects to the claim and requests the court disallow the
SO ORDERED.
SIGNED this 28 day of April, 2008.
________________________________________
J. Rich Leonard
United States Bankruptcy Judge
____________________________________________________________
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total amount of the claim. The trustee contends that the documentation provided with the proof of
claim is insufficient to support the allowance of the claim against the estate. The trustee also objects
to the claim’s treatment as a Section 507(a) priority claim as there is no basis upon which to support
the allowance of a priority claim.
A properly filed proof of claim is “prima facie evidence of the validity and amount of the
claim.” Fed. R. Bankr. Proc. 3001(f). An objecting party has the initial burden of challenging a
properly filed proof of claim. In re Se. Chem. Corp., 2007 Bankr. LEXIS 2136 (Bankr. M.D.N.C.
June 19, 2007). If the objecting party produces evidence challenging the proof of claim, the burden
shifts back to the claimant to prove the claim’s validity. Id. Here, the trustee presented no evidence
that the claim is improper, but merely contends that the supporting documentation is improper. The
trustee’s bare assertion that the claim should be disallowed is insufficient to meet the burden of
challenging a properly filed proof of claim. The court therefore rejects the trustee’s argument that
the proof of claim is improper.
The trustee also challenges Mr. Card’s assertion that the claim is entitled to priority status
under Section 507(a). 	Certain allowed claims are entitled to priority under the Bankruptcy Code.
Prior to the enactment of BAPCPA, Section 507(a) of the Code provided that allowed unsecured
claims earned within ninety days before the date of the filing of the petition for wages, salaries, or
commissions, including vacation pay earned by an individual, were given special priority. 11 U.S.C.
§ 507(a)(4). Here, the period relevant to Mr. Card’s proof of claim is April 1, 2004 to March 31,
2005. Only six of those days fall within the ninety-day priority period prior to the date the petition
was filed on June 24, 2005. Therefore, Mr. Card’s claim is entitled to priority status in the amount
of $113.80, which is 6/365 of the amount of Mr. Card’s allowed claim.
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Based on the foregoing, the court overrules the trustee’s objection to Mr. Card’s proof of
claim and sustains, in part, the trustee’s objection to the claim’s priority status. The claim is allowed
in its entirety, but is entitled to priority status only in the amount of $113.80.
“END OF DOCUMENT”
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