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IN RE U.S. LINES, INC.

Bankruptcy Nos. 86 B 12240, 87-5039A.

79 B.R. 542 (1987)

In re UNITED STATES LINES, INC., Debtor. AMERICAN HULL INSURANCE SYNDICATE, Arkwright-Boston Manufacturers Mutual Insurance Company, New Hampshire Insurance Company, New York Marine Managers, Inc., United States Fidelity & Guaranty Co., Ranger Insurance Company, Underwriters at Lloyd's and Institute Companies Through Price Forbes Limited, Plaintiffs, v. UNITED STATES LINES, INC. and Citibank, N.A., Defendants.

United States Bankruptcy Court, S.D. New York.

October 21, 1987.

Attorney(s) appearing for the Case

Thacher Proffitt & Wood, New York City by Raymond S. Jackson, Jr. and Sheldon A. Vogel, for plaintiffs.

Milbank, Tweed, Hadley & McCloy, New York City by John Gellene and Lorraine Stinnette, for defendant U.S. Lines, Inc.

Shearman & Sterling, New York City by Joseph P. Cyr, for defendant Citibank, N.A.

DECISION

HOWARD C. BUSCHMAN, III, Bankruptcy Judge.

Plaintiffs, an unincorporated group of insurers of the S.S. AMERICAN APOLLO, a vessel owned and operated by the debtor United States Lines, Inc. ("U.S. Lines"), seek to reclaim sums totalling $1,899,448.22 paid to the debtor pursuant to an insurance agreement. Plaintiffs bring this adversary proceeding to impose a constructive trust on $445,159.12 of the total. They also assert priority claims of $999,265...

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