Trustee Services Corp. v. East River Lumber Co. (In Re Hodge Forest Industries, Inc.)

ALFRED C. HAGAN, Bankruptcy Judge.

Plaintiff, Trustee Services Corporation, the trustee appointed in the Hodge Forest Industries, Inc. Chapter 7 bankruptcy case, seeks in this adversary proceeding to avoid East River Lumber Co., Inc.’s perfected security interest in a lease of premises, and in equipment and inventory necessary to operate a sawmill which are part of the estate. Trustee Services argues that, pursuant to I.C. § 28-9-306(2), East River’s security interest lapsed upon the authorized transfer of this property from the McGuckins, who purchased the property from East River, to…