- 11 U.S.C.
Mukamal v. Enriquez (In re Rx Cardiovascular Specialties Inc.)
Sep
15
2006
Ruling
Contemporaneous exchange for new value and ordinary course of business defenses to avoidance are not available with respect to postpetition transfers.
Procedural posture
Plaintiff chapter 7 trustee filed an adversary proceeding against defendant creditor seeking to recover a payment and other transfers as preferences pursuant to 11 U.S.C. §§ 547 and 550. The trustees subsequently filed an amended complaint seeking avoidance and recovery of the payment as an unauthorized postpetition transfer pursuant to 11 U.S.C. § 549. The trustee filed a motion for partial summary judgment on the section 549 claim.
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Court
:
- 11 U.S.C.
Brooks-Hamilton v. City of Oakland (In re Brooks-Hamilton)
Aug
25
2006
Ruling
Postpetition recording of deeds from debtor to prepetition irrevocable trust was avoidable.
Procedural posture
Plaintiff debtor brought an adversary proceeding against defendant trustee in bankruptcy, and the trustee filed cross-claims. At issue was whether the debtor effectively transferred certain real property to an irrevocable trust prior to filing for bankruptcy, so that it was not property of the bankruptcy estate and could not effectively be sold by the trustee. The trustee moved for summary judgment and to dismiss the claims.
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Court
:
Miller v. NLVK LLC (In re Miller)
Jul
21
2006
Ruling
Judgment was reversed and remanded to determine whether present fair equivalent value was paid for property when prior liens are considered.
Procedural posture
The District Court for the District of Nebraska granted plaintiff chapter 11 debtor's request to set aside a property transfer. Defendant purchaser appealed.
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- 11 U.S.C.
Hanrahan v. Walterman (In re Walterman Implement Inc.)
May
22
2006
Ruling
President and sole shareholder of debtor corporation violated automatic stay by postpetition revoking debtor's subchapter S status since that status was estate property.
Procedural posture
Plaintiff chapter 7 trustee filed an action against defendant, the president and sole shareholder of debtor corporation, pursuant to 11 U.S.C. § 549 alleging that defendant revoked the debtor's subchapter S election in violation of the automatic stay. The trustee moved for summary judgment.
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Court
:
- 11 U.S.C.
Sommers v. Katy Steel Co. (In re Contractor Tech. Ltd.)
May
05
2006
Ruling
Trustee was entitled to recover payments since transfers occurred postpetition when checks were cashed not prepetition when checks were written.
Procedural posture
Plaintiff bankruptcy trustee brought adversary proceedings against defendant subcontractors of a bankruptcy debtor, seeking turnover of alleged postpetition payments to the subcontractors under 11 U.S.C. § 549 where the subcontractors were issued checks prepetition by the debtor but the checks were cashed postpetition. The trustee and the subcontractors cross-moved for summary judgment.
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Court
:
- 11 U.S.C.
Continental Mfg. Co. Ltd. v. Sommers (In re Contractor Tech. Ltd.)
Apr
26
2006
Ruling
Transfer was deemed avoidable since check did not clear until postfiling.
Procedural posture
Appellant company sought judicial review of a decision by the Bankruptcy Court for the Southern District of Texas granting summary judgment in favor appellee bankruptcy trustee in an avoidance proceeding under 11 U.S.C. § 549.
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Court
:
- 11 U.S.C.
In re Kmart Corp.
Apr
11
2006
Ruling
Court ruled that debtor payments made to critical vendors pursuant to court order, which was later reversed, were not exempted from payment recovery action.
Procedural posture
The court had previously approved plaintiff debtors'motion under 11 U.S.C. § 105(a) for authorization to pay prepetition claims of critical trade vendors (critical vendor order). The Court of Appeals for the Seventh Circuit reversed the critical vendor order. The debtors then filed adversary proceedings against defendants, critical vendors, to recover payments made pursuant to the order. The critical vendors moved to dismiss.
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Court
:
- 11 U.S.C.
Wells v. TCF Natl Bank (In re Hi Tech Fleet Serv.)
Mar
09
2006
Ruling
Court dismissed the trustee's complaint alleging avoidable transfers and demanding turnover since no provision in either the Code or case law allowed a chapter 7 trustee to bring an action challenging an asset sale consummated pursuant to court order in a chapter 11 proceeding.
Procedural posture
The matter came before the court on plaintiff chapter 7 trustee's motion for summary judgment. The trustee requested summary judgment on a two-count complaint seeking: (1) a determination of the amount, validity, and extent of defendant creditor's claim, and (2) avoidance of an allegedly unauthorized postpetition transfer of funds to the creditor.
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Court
:
Miller v. MBM Corp. (In re Ameriking Inc.)
Mar
02
2006
Ruling
Trustee was denied a motion to further amend a transfer avoidance action complaint on procedural grounds and since the proposed new cause of action was barred by Code section 549(d)'s two-year limitations period.
Procedural posture
Plaintiff chapter 7 trustee filed an original complaint seeking recovery from defendant transferee of eight alleged transfers aggregating $1,222,901 under 11 U.S.C. §§ 547, 548, 502(d) and 550. The amended complaint asserted the same claims as the original complaint, but added a new two-page exhibit "B," detailing 56 apparently additional transfers totaling $4,959,980. The trustee moved for leave to file a second amended complaint.
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Court
:
- 11 U.S.C.
Herrington v. Grant (In re Paxton)
Feb
13
2006
Ruling
Court remanded for consideration whether a trustee had a right to set aside a tax sale, whether that interest transferred to a new property owner, and whether the claim was time barred.
Procedural posture
Appellant purchasers challenged an order of the District Court for the Western District of Louisiana, which set aside a tax sale for lack of sufficient notice of the sale to appellees, co-owners one and an assignee of a mortgagee, and, as to the interest of co-owner two, for violation of an automatic stay.
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