In Re Fox Hill Office Investors, Ltd., Debtor. Fox Hill Office Investors, Ltd. v. Mercantile Bank, N.A. v. Kroh Brothers Development Co.

ARNOLD, Circuit Judge.

Mercantile Bank appeals from a District Court 1 judgment, affirming a decision of the Bankruptcy Court. 2 The Bankruptcy Court decision allows the debtor, the limited partnership Fox Hill Office Investors, to avoid Mercantile’s claim based on a promissory note and mortgage executed by its general partner. We affirm.

Kroh Brothers Equity Company is a wholly owned subsidiary of Kroh Brothers Development Company and was the general partner of Fox Hill, a Kansas limited partnership. On November 5, 1985, John A. Kroh, Jr., president of Kroh Brothers Development, submitted a…