In re: UAL CORPORATION, et al., Debtors. UNITED AIR LINES, INC., Plaintiff. v. U.S. BANK TRUST NATIONAL ASSOCIATION AS TRUSTEE, SUNTRUST BANK AS TRUSTEE, BNY MIDWEST TRUST COMPANY AS TRUSTEE, HSBC BANK USA AS TRUSTEE, and THE CITY OF CHICAGO, Defendants., 346 B.R. 456

Summary

The proceeding arose out of two agreements involving O'Hare between the City of Chicago, which owned and operated it, and debtor, which had major operations there. One agreement required debtor to make payments on bonds issued in connection with the construction of airport improvements; the other governed debtor's use of space at the airport (the Airport Use Agreement (AUA)). The final section of Article XXVII, § 27.08 of the AUA was the provision in dispute. The provision functioned as a cross-default clause, conditioning debtor's exclusive use of terminal space on its performance under a separate agreement to make payments on certain bonds. The court stated that the cross-default rule was applicable. The evidence established that payment of the special facility bonds was unconnected to the City's interests in the AUA. The AUA was a self-contained agreement, governing debtor's use of O'Hare and providing the full consideration for that use. To realize the full value of debtor's ...