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Rick D. Lange, Chap. 7 Trustee v. Dan Henslee (In re Kelly Leann Michener & Thomas J. Michener), Ch. 7, BK14-40294, A14-4024 (Aug. 19, 2014)

In this action brought by the Chapter 7 trustee to avoid and recover a pre-petition transfer of funds from the debtors to their residential landlord as a preference, the court denied the trustee's motion for summary judgment. While the landlord's ยง 365(p) argument regarding the assumption of a personal property lease was inapplicable here, the affirmative defenses in the preference statute were viable. The debtors' pre-payment of a month's rent could be considered an substantially contemporaneous exchange for new value, while the lump-sum payment of a six-month arrearage requires a factual inquiry into whether that was part of the parties' ordinary course of business dealings or financial affairs.

Date: 
Tuesday, August 19, 2014
Judge: 
Judge Thomas L. Saladino