Ray v. Security Mutual Finance Corp. (In Re Arnett)

RALPH H. KELLEY, Bankruptcy Judge.

On December 10, 1980, the debtors obtained a loan from defendant, Security Mutual Finance Corporation, and granted it a security interest in an automobile. The security interest was not perfected until January 12, 1981, which was within 90 days of bankruptcy.

Debtors’ trustee in bankruptcy filed this complaint seeking to avoid the grant of the security interest as a preferential transfer that occurred when the security interest was perfected. 11 U.S.C. § 547.

The trustee also named the American National Bank and Trust Company (the bank) as a defendant because…