In this case, NABT is interested in the proper understanding of the power of an individual trustee to administer an asset of the bankruptcy estate in accordance with the view of the Association about the proper meaning of 11 U.S.C. § 541(a)(3) and its connection to 11 U.S.C. § 544 through 11 U.S.C. § 550.
Bankruptcy has historically been the remedy of creditors. As part of the protection of creditors, a trustee must have some powers derived from thetraditional powers of creditors. Those powers are part of the bankruptcy code in 11 U.S.C. § 541(a)(3) and §§ 544(a) and (b). Imputing knowledge of corrupt managers to a corporation and through the corporation to the bankruptcy estate is illogical. Corrupt management does not disclose its wrongdoing. Instead such persons hide their wrongdoing. This principle is widely recognized at state law, and particularly in the context of the doctrine of adverse domination. Section 544 allows a trustee to act without imputation knowledge of wrongdoing. Application of the doctrine of in pari delicto to deny recovery is inconsistent with legal concept that a trustee takes free of any imputation of knowledge of wrongdoing.