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§ 544(a)(1)

Graham v. Huntington Natl Bank (In re MedCorp. Inc.)

Ruling
Security interests that were never properly perfected could be avoided.
Procedural posture

Chapter 11 trustee filed a motion for summary judgment in his complaint to avoid pursuant to 11 U.S.C.S. § 544 certain prepetiton transfers made to defendant creditor.

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Commercial opinion summary, case decided on March 30, 2012 , LexisNexis #0512-057

Tyler v. Ownit Mortg. Loan Trust

Ruling
Trustee could not avoid deed of trust that was valid under state law despite faulty acknowledgement.
Procedural posture

Appellant trustee filed an adversary proceeding in the United States Bankruptcy Court for the Eastern District of Virginia, seeking under 11 U.S.C.S. § 544(a) to avoid the conveyance of debtors' property to appellee following a foreclosure sale. The bankruptcy court held that the conveyance could not be avoided. The trustee appealed.

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Consumer opinion summary, case decided on October 28, 2011 , LexisNexis #1111-088

Official Comm. of Unsecured Creditors of Taylor-Ramsey Corp. v. Ramsey (In re Taylor-Ramsey Corp.)

Ruling
Trustee could avoid unrecorded deed of trust through status as hypothetical lien creditor.
Procedural posture

Plaintiff committee of unsecured creditors filed an adversary proceeding against defendant creditor in which plaintiff sought in part to avoid defendant's unrecorded deed of trust as a hypothetical judicial lien creditor under 11 U.S.C.S. § 544(a)(1). Both parties filed motions for partial summary judgment on the issue of avoidance of the deed of trust.

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Commercial opinion summary, case decided on October 06, 2011 , LexisNexis #1111-025

Gold v. Pasternak (In re Harvey Goldman & Co.)

Ruling
Trustee could avoid security interest of living trust in debtor's property.
Procedural posture

Plaintiff Chapter 7 trustee filed an adversary proceeding against defendants, two individuals who served as trustees of an irrevocable living trust, seeking a determination, inter alia, that he was entitled under 11 U.S.C.S. § 544 to avoid a security interest the trust held in property that belonged to a corporation's Chapter 7 bankruptcy estate. The Chapter 7 trustee filed a motion for summary judgment.

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Commercial opinion summary, case decided on September 13, 2011 , LexisNexis #1011-018

In re K-Ram Inc.

Ruling
Creditor not entitled to proceeds of sale deposited in court registry as its security interest was unperfected.
Procedural posture

Chapter 11 debtor and a claimant filed cross motions for summary judgment to determine ownership of funds in the court's registry.

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Commercial opinion summary, case decided on March 22, 2011 , LexisNexis #0411-122

In re Thams

Ruling
Trustee's lien rights in debtor's vehicle were superior to those of co-debtor who held no legal interest.
Procedural posture

Chapter 7 debtors contended that the female debtor was entitled to an equitable ownership interest in a vehicle titled solely in the male debtor's name. The trustee objected.

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Consumer opinion summary, case decided on March 10, 2011 , LexisNexis #0411-088

In re White

Ruling
Trustee could not use strong-arm powers to step into the shoes of a preferred class of creditors in order to seize the assets of a spendthrift trust.
Procedural posture

A Chapter 7 trustee filed an objection to a debtor's claim of exemption in a spendthrift trust, asserting that he could attach her interest, not generally, but to satisfy her student loan creditors and certain other creditors. The trustee argued that under 11 U.S.C.S. § 544(a)(1), he was entitled to step into the shoes of a creditor for the purposes of invading the trust. The debtor and a trustee under the spendthrift trust opposed the objection.

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Consumer opinion summary, case decided on September 30, 2010 , LexisNexis #1110-054

Rogan v. MILA (In re Allen)

Ruling
Trustee could not avoid mortgage securing properly endorsed note.
Procedural posture

Chapter 7 trustee filed a complaint against defendant creditors to avoid a mortgage lien pursuant to his strong arm powers in 11 U.S.C.S. § 544(a)(1). The trustee and one of the creditors, the holder of the mortgage and note, filed cross-motions for summary judgment. Another creditor, a second mortgage holder, filed a motion for summary judgment, joining in the trustee's motion.

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Consumer opinion summary, case decided on August 11, 2010 , LexisNexis #0910-086

Mercer v. Bank of Currituck (In re Mercer)

Ruling
Lien that was improperly perfected on petition date could be avoided by debtor in possession.
Procedural posture

This adversary proceeding was filed by plaintiff debtor to determine the validity of the lien asserted by defendant bank on real property owned by debtor. The matter before the court was debtor's motion for partial summary judgment, seeking to avoid the bank's lien under 11 U.S.C.S. §§ 544(a)(1), 1107(a) as unenforceable against the debtor-in-possession because the lien was not properly perfected at the time of debtor's bankruptcy filing.

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Consumer opinion summary, case decided on July 23, 2010 , LexisNexis #0910-021

Gugino v. Wells Fargo Bank Northwest (In re Lifestyle Home Furnishings LLC)

Ruling
Security interest avoided due to creditor's failure to file amendment reflecting debtor's new name.
Procedural posture

Chapter 7 trustee, brought an adversary proceeding against defendant creditor, to avoid its claimed security interest on property of the bankruptcy estate under 11 U.S.C.S. § 544(a)(1). The trustee moved for the entry of partial summary judgment, asserting the creditor failed to comply with Idaho law regarding the perfection of its security interest and that its interest became unperfected after the debtor changed its name.

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Consumer opinion summary, case decided on January 14, 2010 , LexisNexis #0310-017