In Re Johns-Manville Corp.

DECISION AND ORDER ON KEENE’S MOTION TO APPOINT A LEGAL REPRESENTATIVE FOR FUTURE CLAIMANTS

I. Introduction and Issue Presented

Keene Corp. has put before this Court a motion to appoint a legal representative for asbestos-exposed future claimants in the Manville reorganization case. It is abundantly clear that the Manville reorganization will have to be accountable to future asbestos claimants whose compelling interest must be safeguarded in order to leave a residue of assets sufficient to accommodate a meaningful resolution of the Manville asbestos-related health problem. The term “future asbestos claimants” is defined for these purposes to include all persons and entities who, on or before August 26, 1982, *745 came into contact with asbestos or asbestos-containing products mined, fabricated, manufactured, supplied or sold by Manville and who have not yet filed claims against Man-ville for personal injuries or property damage. These claimants may be unaware of their entitlement to recourse against Man-ville due to the latency period of many years characterizing manifestation of all asbestos related diseases. See Keene Corp. v. Insurance Co. of North America, 667 F.2d 1034, 1038 n. 3 (D.C.Cir.1981), cert. denied, 455 U.S. 1007,102 S.Ct. 1644, 71 L.Ed.2d 875 (1982). See also Irving J. Selikoff, Douglas H.K. Lee, Asbestos and Disease, Academic Press, Inc. (1978).

Exposure to asbestos dust may result in one of three diseases: asbestosis, a chronic disease of the lungs causing shortness of breath similar to emphysema; mesothelio-ma, a fatal cancer of the lining of the chest, abdomen or lung, and lung or other cancers. However, it is contended by Manville that it was not until recently that the full extent of the dangers due to asbestos exposure was clarified. 1 Thus, the enhanced safety programs which eventuated because of the new discoveries regarding the damages of asbestos were too late to have any effect on those who had previously been exposed. Accordingly, Manville expects a proliferation of claims in the next 30 years by those previously exposed who will manifest these diseases in this period.

An excursis into the various factors supporting this Court’s conclusion that these future claimants possess at the very least a cognizable interest in this reorganization case follows. These factors include the applicability of Code Section 1109(b) regarding parties in interest and those insurance cases holding that a proper trigger for insurance coverage for claims liability is exposure to asbestos. Analysis also focuses on the statistical data relating to the proliferation of future asbestos claims submitted by Manville in support of its petition as well as facts known and agreed to by all parties which dictate a finding that these claimants are parties in interest entitled to representation in this case. This excursis will conclude by exploring the kinds of entities which may be utilized to represent future claimants in these proceedings.

II. Whether Or Not They Possess Cognizable Claims, Future Claimants Do Possess A Cognizable Interest In This Reorganization

A. Statistical Data Submitted by Man-ville Support A Finding Of Cognizable Interest On The Part Of Future Claimants

From the inception of this case, it has been obvious to all concerned that the very purpose of the initiation of these proceedings is to deal in some fashion with claimants exposed to the ravages of asbestos dust who have not as of the filing date manifested symptoms of asbestos disease. Indeed, but for this continually evolving albeit amorphous constituency, it is clear that an otherwise economically robust Manville would not have commenced these reorganization proceedings. See generally Note, Manville: Good Faith Reorganization or “Insulated” Bankruptcy, 12 Hofstra L.Rev. 121 (1983). It should also be noted that there are suggestions in the vast record before this Court that Manville is not as economically sound as reputed. See footnote 2 in Decision No. 1 on correlated Man-ville matters accompanying this opinion. It is the spectre of proliferating, overburdening litigation to be commenced in the next 20-30 years, which litigation would be beyond the company’s ability to manage, control, and pay for, which has prompted this filing.

In the affidavit of Manville officer James Beasley accompanying the filing pursuant to Additional Local Rule XI-2, Manville sets forth its reasons for seeking relief un *746 der Chapter 11. According to this affidavit, it is in great measure the impact of the future claimants which necessitates the filing. Beasley states:

Manville Corporation’s Board of Directors, and a special committee appointed by the Board to oversee the review of the consultant’s report, have concluded that the potential future impact on J-M, Manville and various other of the Debtors which are named or potential defendants of pending and future asbestos cases could and probably will exceed Manville’s ability to pay and finance the continuing operation of Manville’s businesses.

Beasley Affidavit at 7.

This projection by Manville has reportedly been based on the study by Epidemiological Research Institute (“ERI”), a consulting firm specializing in biostatistical research commissioned by Manville in response to an increase in the number of asbestos cases. According to the Beasley Affidavit, this increase is evidenced by the fact that as of June 30,1983, the number of asbestos cases had increased by approximately 1,700 cases over the December 31, 1981 level of 9,300 cases. The level of cases on December 30, 1980 had been only 5,087 and during the first half of 1982, an average of approximately 495 new plaintiffs per month commenced an average of approximately 425 cases per month against Manville. Beasley Affidavit at 5. The ERI study commissioned in response to these statistics estimated that “a reasonable control projection of the number of lawsuits seen from 1982 on is likely to be about 45,000, with a reasonably firm lower bound of 30,000 and a very definitive upper bound on the order of 120,000. Projections of Asbestos Related Diseases 1980-2009, Final Report, August 2, 1982, at 27. See also Decision No. l’s discussion of Compendium submitted by Man-ville in opposition to the Asbestos Committee’s motion to dismiss regarding the content of all of the statistical studies and deliberations leading up to the filing.

Beasley also reports that as of the filing, Manville had been found liable for punitive damages in ten asbestos suits and that $616,000 was the average award in each ease. Beasley Affidavit at 6. One such reported case where an award of punitive damages was affirmed is Moran v. Johns-Manville Sales Corp., 691 F.2d 811 (6th Cir. 1982).

The Beasley Affidavit concludes that based on an estimated cost of $40,000 per case, the total projected cost of the future suits could range anywhere between $2 billion and many times that amount over the next 20 years and potentially force the sale, liquidation or other disposition of Manville’s assets and the dismemberment of its business. Beasley Affidavit at 7. Indications that the estimates of a lower bound of 30,000 cases costing $40,000 per case may have been too conservative can be found in a New York Times article regarding the increase in size of jury verdicts against the codefendants since the filing date. See New York Times, January 10, 1983, D — 2, col. 1. See also footnote 2 in Decision No. 1 on correlated Manville matters regarding the conservatism built into the calculation of the $1.9 billion debt figure predicating the filing.

Accordingly, a resolution of the interests of future claimants is a central focus of these reorganization proceedings. Any plan emerging from this case which ignores these claimants would serve the interests of neither the debtor nor any of its other creditor constituencies in that the central short and long-term economic drain on the debtor would not have been eliminated. Manville might indeed be forced to file again and again if this eventuated. Each filing would leave attenuated assets available to deal with interests of emerging future claimants. Manville could also be forced into liquidation. The liquidation of this substantial corporation would be economically inefficient in not only leaving many asbestos claimants uncompensated, but also in eliminating needed jobs and the productivity emanating from an ongoing concern. It fosters the key aims of Chapter 11 to avoid liquidation at all reasonable costs.

As detailed in Decision No. 1 accompanying this opinion regarding the Asbestos *747 Committee’s Motion to Dismiss, the drafters of the Code specifically built into it the concept of “open access to the bankruptcy process.” Report of the Commission on the Bankruptcy Laws of the United States, H.R.Doc. No. 137, 95th Cong., 1st Sess. 75, 79 (1977). In addition, the drafters deliberately decided to eliminate the requirement that a debtor wait to file until its economic prospects are beyond salvation. See id. at 75. Accordingly, in order to resolve Man-ville’s deep economic crisis, the rights of future claimants must be considered and represented at this crucial point in the reorganization case so as to avoid functional extinction of the debtor enterprise.

Indeed, in the final stages of preparation of this opinion, the Seventh Circuit issued its decision in In re UNR Industries, Inc., 725 F.2d 1111, (7th Cir.1984), concerning a decision below denying the appointment of a legal representative for future asbestos claimants. Although the Seventh Circuit held that the issue was not ripe for appellate review, it did declare in dicta the importance of future claimants to any plan emerging from this kind of reorganization. The Seventh Circuit stated: “If future claims cannot be discharged before they ripen, UNR may not be able to emerge from bankruptcy with reasonable prospects for continued existence as a going concern.” Id. at 1119.

B. The Elastic Concept of “Party In In terest” and Section 1109(b) of the Code

Section 1109(b) of the Code, 11 U.S.C. § 1109(b), makes clear that any “party in interest” may appear and be heard in a Chapter 11 case. It provides:

“Any party in interest, including the debtor, the trustee, a creditors’ committee, an equity security holders’ committee, an equity holder, or any indenture trustee, may raise and may appear and be heard on any issue in a case under this chapter.”

11 U.S.C. § 1109(b).

The term “party in interest” has no specific definition in the Code and its applicability must be determined on an “ad hoc ” basis. In re Penn Dixie Industries, Inc., 9 B.R. 941, 943 n. 7 (Bkrtcy.S.D.N.Y.1981). The Collier treatise states that this term must be construed broadly so that parties affected by a Chapter 11 case have an opportunity to be heard. See 5 Collier on Bankruptcy ¶ 1109.02 at 1109-22 to 1109-23 (15th ed. 1979). In addition, Colliers’ Comment to this section states: “As in the case of Section 206 of the Act and Rule 10-210(a)(1) [predecessor provisions] section 1109(b) continues the broad concept of the absolute right to be heard in order to insure fair representation in the case and prevent excessive control by insider groups.” 11 U.S.C. § 1109(b), Colliers Pamphlet Edition (1983).

Section 206 of the predecessor Act represented an effort to encourage and promote individual participation in reorganization cases by creditors and stockholders and to foster democratization of such cases. See House Hearings on H.R. 6439, 75th Cong., 1st Sess. 185 (1937); House Report No. 1409 on H.R. 8046, 75th Cong., 1st Sess. 47-48 (1937). The Third Circuit stated in an early decision: “In substituting Chapter X for section 77B Congress clearly intended to broaden the rights ... to participate in corporate reorganization proceedings.” In re Keystone Realty Holding Co., 117 F.2d 1003, 1005 (3d Cir.1941). Thus, courts declared that there was no need to seek intervention to obtain full participation in the reorganization by any creditor, stockholder or indenture trustee, or of a duly authorized creditors’ or stockholders’ committee since Rule 10-210(a)(l) gave every right that intervention could give. See, e.g., In re Duplan Corp., 450 F.Supp. 790, 791 (D.C.S.D.N. Y.1978); 5 Collier on Bankruptcy ¶ 1109.02 at 1109-20.

Code Section 1109(b) continues the broadening of the concept of party in interest which began under the predecessor Act. Contrary to the position urged by counsel for Peter John Robinson, a self-styled future claimant, the listing of examples of *748 parties in interest in Code Section 1109 is not meant to exclude other types of interested parties from the purview of that section. As Colliers states: “Section 1109(b) does not limit who in a Chapter 11 case may be a party in interest. Section 102(3) states that the term ‘including’ is not limiting, and thus the use of the word ‘including’ in section 1109(b) does not limit ‘party in interest’ status to those parties referred to in the subsection.” 5 Collier on Bankruptcy ¶ 1109.02 at 1109-22.

The Second Circuit has recently opined in limiting fashion on the broad concept of party in interest. However, the facts predi-eating the Second Circuit’s opinion in In re Comcoach Corp., 698 F.2d 571 (2d Cir.1983), are wholly distinguishable from the instant facts. Indeed, Judge Haight in affirming this Court’s opinion in Commercial Union Insurance Co. v. Johns-Manville Corp., et al, Bankr.L.Rep. (CCH) ¶ 69,215 (Bankr.S.D.N. Y.1983), held that Comcoach does not bar a true party in interest from participating in the Manville reorganization proceedings. 2

While the precise contours of Code Section 1109(b) have yet to be fixed, they are certainly broad enough to embrace the interests of future claimants as affected *749 parties. Future claimants are undeniably parties in interest to these reorganization proceedings pursuant to the broad, flexible definition of that term enunciated by the foregoing authorities. The drafting of “party in interest” as an elastic concept was designed for just this kind situation. As detailed above, future claimants are indeed the central focus of the entire reorganization. Any plan not dealing with their inter.ests precludes a meaningful and effective reorganization and thus inures to the detriment of the reorganization body politic. Any meaningful plan will either provide funding for future claimants directly or provide for the continuation of some form of responsive, ongoing entity post-confirmation, from which to glean assets with which to pay them. If they are denied standing as parties in interest, they will be denied all opportunity either to help design the ship that sails away from these reorganization proceedings with their cargo on board or to assert their interests during a pre-launching distribution. See Decision No. 1 re GAF, Whitman and Co-defendant’s Motions. In either event, the direct impact on these claimants will be enormous as declared by the Seventh Circuit in In re UNR, supra. See discussion of the dicta of the Seventh Circuit on the crucial nature of the interest of future claimants in this decision, supra. Thus, because none of the existing committees of unsecured creditors and present asbestos claimants represents this key group 3 , a separate and distinct representative for these parties in interest must be established so that these claimants have a role in the formulation of such a plan. This is especially so given that any plan of reorganization must necessarily balance the rights and needs of prepetition creditors against the anticipated rights and needs of postpetition creditors with Manville’s purportedly limited assets and further economic prospects apportioned accordingly.

C. Since Exposure Triggers Insurance Coverage, These Putative Claimants Are Parties In Interest

Another basis for this Court’s holding that the future claimants are a wholly cognizable constituency as parties in interest under Section 1109(b) is that the vast majority of courts considering the issue have held that mere exposure to asbestos triggers insurance coverage. See Insurance Co. of North America v. Forty Eight Insulations, Inc., 633 F.2d 1212 (6th Cir.1980) aff’d on rehearing, 657 F.2d 814 (6th Cir. 1981), rehearing denied, 455 U.S. 1009, 102 S.Ct. 1648, 71 L.Ed.2d 878 (1982). See also Keene Corp. v. Insurance Co. of North America, 667 F.2d 1034 (D.C.Cir.1981), cert. denied, 455 U.S. 1007, 102 S.Ct. 1644, 71 L.Ed.2d 875 (1982); Porter v. American Optical Co., 641 F.2d 1128 (5th Cir.), cert. denied, 454 U.S. 1109, 102 S.Ct. 686, 70 L.Ed.2d 650 (1981) (where the courts decided that both exposure and manifestation trigger coverage under comprehensive general liability policies). But see Eagle-Picher *750 Industries v. Liberty Mutual Insurance Co., 682 F.2d 12 (1st Cir.1982), cert. denied, U.S. -, 103 S.Ct. 1280, 75 L.Ed.2d 500 (1983). The Eagle-Picher decision holding that manifestation triggers coverage is distinguishable on its own facts from the Man-ville case. First, the insured itself urged a manifestation theory. Second, the First Circuit did not consider evidence relating to industry custom and usage because Eagle-Picher and its carriers stipulated that the policies were not ambiguous.

It follows logically that if exposure triggers a sufficient interest on the part of future claimants to warrant insurance coverage, then this same exposure should a fortiori justify a declaration that they are parties in interest to be impacted by these proceedings. As background, it should be noted that the controversy regarding the appropriate trigger for insurance coverage is part of the major litigation which Man-ville and other asbestos defendants are embroiled in with their insurance carriers. These carriers, approximately 25 in number who wrote approximately 100 policies for Manville, have by and large refused to provide defense and indemnity to Manville in asbestos cases. Manville asserts that its inability to look to at least $600 million in insurance coverage is a major factor in its decision to seek Chapter 11 relief. See also Background to Decision No. 1 accompanying this opinion. The insurance companies have created two inconsistent theories of insurance coverage by which they interpret their standard insurance policy language. It thus appears that those companies which sold coverage when the asbestos plaintiffs were manifesting symptoms advocate an exposure theory of coverage, whereby they contend that only the policies in force at the earlier point of exposure apply. Those companies which sold policies at the earlier time of exposure generally advocate a manifestation theory, contending that the single policy in effect when a claimant manifested symptoms is the only source of coverage. In fact, one court has noted that the switching of positions by the insurance industry to suit their economic needs is among the reasons for rejection of the manifestation theory. See Insurance Co. of North America v. Forty Eight Insulations, Inc., 451 F.Supp. 1230, 1239 (E.D.Mich.1978).

Most recently, a New York State Supreme Court has used the precedent of Keene and Forty-Eight Insulations, Inc. in denying a summary judgment motion on the theory that exposure to lead poisoning, another disease with a latency period, may be an “occurrence” sufficient to trigger insurance coverage. See Allstate Insurance Co. v. Colonial Realty Co., N.Y.L.J. 11/15/83 at 14, col. 5 (Sup.Ct.Kings Cty. November 1983).

A major argument advanced in In re Amatex Corp., 30 B.R. 309 (Bkrtcy.E.D.Pa. 1983), Adopted No. 6011. (E.D.Pa. filed Nov. 9, 1983), where the court held that future claims are not cognizable in bankruptcy was that courts in most states date the statute of limitations from the point of manifestation, see e.g., Fusco v. Johns-Man-ville Corp., 643 F.2d 1181 (5th Cir.1981); Karjala v. Johns-Manville Products Corp., 523 F.2d 155 (8th Cir.1975). This fact, however, does not vitiate the status of future claimants as parties in interest to this bankruptcy. Unlike the trigger of insurance coverage at the point of exposure, the fixation of a statute of limitations is totally unrelated to the status of future claimants as parties in interest. 4 In Amatex, the *751 debtor stipulated to one witness’ opinion that all states date asbestos causes of action from the point of manifestation. See Ama-tex, supra, 30 B.R. at 311. The Amatex *752 court relied on this stipulated testimony to reach its conclusion that future claims are not cognizable in a reorganization. Id. at 315.

First, it should be noted that not all states date the statute of limitations from point of manifestation. New York and Indiana law have been construed to date their asbestos inhalation actions for statute of limitations purposes not from the point of manifestation of disease, but rather from the point of exposure or inhalation of the toxic substance. See Steinhardt v. Johns-Manville Corp., 54 N.Y.2d 1008, 446 N.Y. S.2d 244, 430 N.E.2d 1297 (1981) (construing New York law), appeal dismissed, 456 U.S. 967, 102 S.Ct. 2226, 72 L.Ed.2d 840 (1982); Braswell v. Flintkote Mines Ltd., 723 F.2d 527 (7th Cir.1983) (construing Indiana law). Interestingly, the Seventh Circuit in In re UNR, supra declared in dicta that future claims should probably thus be cognizable in New York and Indiana articulating:

In any event, some at least of the many thousands of workers who have been exposed to asbestos sold by UNR must have been exposed in states such as Indiana and New York where the cause of action accrues upon inhalation, and their claims against the bankrupt estate — accrued tort claims — would appear uncontroversially to be provable in bankruptcy.

At 1119 (emphasis added).

Second, that a majority of jurisdictions date the statute of limitations from the point of manifestation of the disease should not have the unintended effect of barring those who have not as yet manifested disease from asserting their status as parties in interest in this bankruptcy proceeding. This is because the policy reasons underlying the fixation by each state of a point from which to date a limitations statute are wholly different from those governing a bankruptcy court’s finding that those who have not yet manifested symptoms of the disease are parties in interest in the case. The Supreme Court in United States v. Kubrick, 444 U.S. 111, 100 S.Ct. 352, 62 L.Ed.2d 259 (1979) articulated the policies served by a statute of limitations, declaring:

Statutes of limitation which ‘are found and approved in all systems of enlightened jurisprudence’ ... represent a pervasive legislative judgment that it is unjust to fail to put the adversary on notice to defend within a specified period of time and that ‘the right to be free of state claims in time comes to prevail over the right to prosecute them’.... These *753 enactments are statutes of repose; and although affording plaintiffs what the legislature deems a reasonable time to present their claims, they protect defendants and the courts from having to deal with cases in which the search for truth may be seriously impaired by the loss of evidence, whether by death or disappearance of witnesses, fading memories, disappearance of documents, or otherwise.

Id. at 117, 100 S.Ct. at 356 (citations omitted).

Thus, the fixation of the point from which to date a statute of limitations includes an assessment of the general need for repose against the need for redress of injury. In contrast, the assessment of whether future claimants are parties in interest is an ad hoc determination of the potential detriment to these parties which nonrepresentation would work.

In any event, the factors militating in favor of declaring future claimants parties in interest are more akin to those factors which prompted a majority of courts to hold that exposure is an appropriate trigger to insurance coverage than to those considered in fashioning an appropriate statute of limitations. The Seventh Circuit in UNR, supra stated in dicta that the state law policy reasons justifying the postponement of tort claim accrual to manifestation relate in no way to a desire to disenfranchise future claimants:

Evén in a “discovery” state the cause of action may “exist” before it “accrues”— that is before the statute of limitations on bringing it begins to run.... These states postpone the date of accrual of the cause of action not in order to prevent the early filing of claims but in order to lift the bar of the statute of limitations to later filings”.

At 1119. In addition, the Sixth Circuit in its opinion in Insurance Co. of North America, supra, affirming and modifying its earlier holding that a trigger for coverage is exposure, reiterated its reasoning that “bodily injury” occurs when an asbestos victim first starts breathing asbestos fibers. See Insurance Co. of North America, 657 F.2d at 816. Similarly, the District of Columbia Circuit Court of Appeals declared in Keene, supra, that the term “bodily injury” in comprehensive liability policies means “any part of the single injurious process that asbestos-related diseases entails.” See Keene, 667 F.2d at 1047.

In the instant case, this comprehensive definition of bodily injury covering mere exposure militates in favor of a declaration that those who have been exposed to asbestos prepetition and have manifested or will manifest disease post-petition are parties in interest to this reorganization case. See also Commercial Union Insurance Company v. Pittsburgh Corning Corp., 553 F.Supp. 425, 433 (E.D.Pa.1981), in which the district court construed the coverage provisions of an excess, insurance policy for liabilities relating to alleged asbestos injuries. Faced with a conflict between exposure and manifestation theories under Pennsylvania law, the district court concluded:

For the reasons which follow, I hold in favor of an exposure theory based on either of two simple, uncontroverted, and indisputable facts: (1) asbestos disease is cumulative; and (2) some microscopic damage occurs before manifestation of the injury. See, e.g. Insurance Co. of North America v. Forty-Eight Insulations, Inc., 633 F.2d 1212, 1214 (6th Cir. 1980), petition for cert. filed 50 U.S.L.W. 5023 (U.S, July 31, 1981) (No. 81-198). By the former, I mean that asbestos diseases are caused by an accumulation over time of asbestos particles in the body. Particles accumulated during exposure, but before manifestation of an asbestos disease, are a cause-in-fact of the disease. The second fact statement is self-explanatory.

Id.

Thus, this policy underlying the finding that mere exposure triggers coverage likewise militates in favor of a declaration that future claimants are parties in interest.

D. Prior Holdings Are Not at Odds With a Finding That Future Claimants Are Parties In Interest

In holding in favor of the appointment of a legal representative for future claimants, *754 this Court is not unmindful of the decisions of two courts faced with similar problems, In re UNR Industries, 29 B.R. 741 (D.C.N.D. 111.1983), and In re Amatex Corp., supra. In Amatex, Bankruptcy Judge King submitted an advisory report and recommendations to the district court declaring that future claims are not cognizable in bankruptcy, which findings were adopted by the district court. The Amatex decision is currently on appeal. Similarly, in UNR, District Judge Hart held that future asbestos-related health claims are not dischargeable in bankruptcy. As noted supra, the Seventh Circuit in In re UNR, supra only a few days ago and during the final drafting of this opinion dismissed the appeal, holding that the issue of appointment of a legal representative is not yet ripe for appellate review because neither a plan proposing to discharge future claimants nor a proof of claim which can be objected to has been filed in the case. However, the Seventh Circuit as described and quoted supra did in dicta declare the nature of the keen interest of future claimants in the reorganization. In so stating, the Circuit also declared the primacy of “a bankruptcy court’s equitable powers” even in the face of a finding (non final) that an unaccrued tort claim is not a cognizable claim in bankruptcy. At 1119. It should be noted that unlike in UNR, in the Manville case, it appears that at least several claims by future claimants have been filed.

First, although some of the statements in dicta by the Seventh Circuit in UNR may be interpreted to favor the dischargeability

of future claims, it is unnecessary for this Court to face the dischargeability issue at this time in order to decide whether these claimants are parties in interest. In fact, this Court may never be faced with deciding the dischargeability issue since Man-ville’s currently proposed nonconsensual plan intends to treat future claims as non-dischargeable. This plan impacts on future claimants only in a de facto manner in shaping the claims estimation process and the residue Manville entity that will emerge post-confirmation. That is not to say that during the course of these proceedings a plan confronting dischargeability of future claims will never be filed. 5 Or, this group may be considered as a distinct, cognizable, certifiable class in light of the Agent Orange opinion dealing with mass exposure to a toxic substance. See footnote 6, p. 754 infra. In any event, the concept of “party in interest” is an elastic and broad one designed to give a Court great latitude to insure fair representation of all constituencies impacted in any significant way by a Chapter 11 case.

In contrast, the concept of dis-chargeability of claims cognizable in the reorganization may require a showing that due process has been achieved in binding unknown putative claimants to a plan of which they may or may not have had notice. Thus, Judge Hart’s pronouncement that the contingent claims of future asbestos claimants are not cognizable in bankruptcy for dischargeability purposes because they are grounded in tort instead of contract law, whether correct or incorrect 6 , is not binding *755 on this Court’s determination of whether these claimants are parties in interest. He declares: “The Court is not unaware that in refusing to approve of a procedure by which *756 the rights of putative claimants would be adjudicated and cut off, the putative claimants may wind up with judgments against corporations left with only one asset: a corporate charter.” In re UNR, 29 B.R. at 748. Thus, even Judge Hart recognizes the probability of significant detriment which future claimants will suffer if not provided for either directly within the reorganization itself or indirectly, by restructuring the company in such a way as to provide more than a mere corporate charter with which to pay these claims.

Similarly, Bankruptcy Judge King in Am-atex declares: “The debtor argues persuasively that a guardian is necessary to protect these interests on the basis that if the company fails to rehabilitate itself and is liquidated, these claims will have no recourse against any future fund.” In re Amatex, 30 B.R. 309, 10 B.C.D. 955, 960. Judge King then goes on to note that he can conceive of no way in which a guardian could improve the business climate so as to guarantee the survival of the company. Such observation appears to this Court to be limited merely to Judge King’s individual assessment concerning the Amatex case of the effectiveness of such a guardian in representing the interests of those affected parties. However, his statements are not contrary to the concept of future claimants as parties in interest with a real stake in the current case.

*757 Moreover, further evidence that no plan of reorganization for Manville is feasible and none can be confirmed without some direct or indirect, de jare or de facto consideration of the future claims issue is found in the report of an Examiner appointed in the UNR bankruptcy case. Indeed, the UNR Examiner, in his preliminary report rendered on April 22, 1983, subsequent to Judge Hart’s decision denying the appointment of representative for future claimants, declared:

Regardless of whether or not the unknown claims can be barred in these proceedings, it is important that they be determined as accurately as possible before any decision can be made about the future of the debtors. It would be difficult to determine if any plan would be feasible unless some estimate is made of claims that would not be discharged by the proceedings.

UNR Examiner’s Preliminary Report, p. 10.

This court has been informed that as a result of this report, the bankruptcy court involved in the UNR case has authorized a study of future claims and that Judge Hart has refused to intervene except to recommend that the examiner consider the data contained in Manville’s ERI Study.

It is thus the unprecedented, extraordinary nature of these proceedings that mandates a declaration that these claimants are parties in interest under Code Section 1109(b) in need of a legal representative to act independently and impartially where appropriate in the case. The participation of such a representative is especially important to the development of any plan, consensual or otherwise, which will include the formulation of claims estimation procedures. Such appointment is also grounded on the Court’s pervasive equitable powers emanating from Section 1481 of Title 28, U.S.Code and Section 105(a) of the Bankruptcy Code. These equitable powers are vested in this Court specifically to enable it to respond to extraordinary problems in estate administration consistent with the statutory goals of Chapter 11 of Title 11 U.S.C.

The fact that one plan has already been filed without the participation of a future interest constituency is not truly relevant. In this case, it is quite probable that the first-filed plan will only form the basis for intense negotiation aimed at forging a consensual confirmable plan or failing that, an imposed plan. In fact, representatives for both the Asbestos Committee and Manville reaffirmed their desire to effect a consensual plan at the hearing on November 21,1983 where Manville filed its plan. The empty chair in these proceedings can and must be filled to give this affected group more than the empathetic consideration it currently receives from the other participants in the reorganization.

Much of the opposition expressed by the constituencies in this case is concerned with the mechanical difficulties of appointment, i.e., the fairness of a single representative, or the lack of a specifically defined role. The Unsecured Creditors Committee argues that if a representative can be appointed, it should not be a solitary representative, but rather a committee of persons representing this group. See 11 U.S.C. § 1102. The Equity Committee takes the position that if future claims are to be dealt with, the appointment of a legal representative at this time would serve no tangible objective because it is only when Manville seeks an inevitable injunction prohibiting future claimants from asserting their claims against an asset-shielded post-confirmation entity that this representative’s function is no longer amorphous. This statement exhibits the Equity Committee’s basic belief that a legal representative for future claimants is appropriate to the reorganization process. The Committee only differs from Keene and Manville on the timing of such appointment.

E. Some Kind of Representative Is Appropriate In the Instant Case

The concept of the appointment of some kind representative for parties in interest whose identities are yet unknown is