Williams v. Wells Fargo Financial Mississippi 2, Inc. (In Re Rick's Auto Outlet of Monticello, LLC)

MAHONEY, Bankruptcy Judge.

This is an appeal from an order of the bankruptcy court of February 9, 2005, denying the Chapter 7 trustee’s complaint to avoid a lien on real property. For the reasons stated below, we reverse.

Background

The debtor, Rick’s Auto Outlet of Monticello, Arkansas (the LLC), owned real property in Monticello, Arkansas. A married couple, who were members of the LLC, subsequently executed a deed of trust on property they owned as individuals and on the property owned by the LLC. The deed of trust was signed by them individually, and the acknowledgment identified them…