Kentucky Central Insurance v. Brown

RONALD LEE GILMAN, Circuit Judge.

This case involves the resolution of bankruptcy claims between Larbar Corporation, a highway contractor, and Kentucky Central Insurance Company (KCIC), its surety. In June of 1994, the trustee of Larbar’s bankruptcy estate filed suit seeking to avoid the late-filed security interest created by a 1989 Agreement of Indemnity between Larbar and KCIC. In response, KCIC claimed that (1) its security interest is not avoidable, (2) even if its security interest is avoidable, KCIC is nevertheless entitled to the receivables due Larbar under either the doctrine of…