Graban v. McDowell National Bank (In re Engel)

OPINION

WARREN W. BENTZ, Bankruptcy Judge.

Issue

This is a preference action. The issue is whether accounts receivable of the debtors, which were either paid into the debtors' bank account at McDowell National Bank (the “Bank”) and set off by it, or otherwise collected by the Bank, were preferences, where the Bank had a duly perfected security interest in the debtors’ accounts receivable and other real and personal property, but the amounts in question collected by the Bank were earned by the debtors after the 90th day before the filing of the bankruptcy petition, and represented an improvement…