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forwarding to the purchaser. There is no reporting obligation to
the purchaser concerning the status of the PLRF account. In the
event of the Dealership’s default, the purchaser cannot look to
the PLRF for satisfaction of the Dealership's obligation. His
recourse is to file a claim with Travelers. It is the insurance
company which, after paying the purchaser's claim, is entitled to
recover its loss out of the Dealership's PLRF account. The
accounts are titled in the name of the Escrow Trustees "for the
Dealer Group" or for each Dealership separately, and the
Dealerships are designated as the FDIC insured depositors. These
provisions refute the proposition that the contract holders were
intended to hold a beneficial interest in the trust.
Furthermore, we are unable to see any functional rationale
for petitioners' theory of beneficial ownership. The
accumulation and conservation of the trust fund was clearly a
matter of concern to the Dealerships. As long as they fulfilled
certain minimal conditions, they were entitled to recover at
least the principal portion (if not also the income portion) of
any unconsumed reserves. They were personally liable for any
losses in excess of the reserves and would have to pay for these
losses out of their own pockets if they failed to maintain excess
loss insurance or properly file claims under the insurance
policies. One of the primary purposes of the PLRF arrangement
was to provide the Dealership with greater security than the
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