In Re Howell Enterprises, Inc., Debtor. Tradax America, Inc. v. First National Bank in Stuttgart, Arkansas and Howell Enterprises, Inc.

ROSENBAUM, District Judge.

It all started simply enough. Howell Enterprises, Inc., (Howell) and Tradax America, Inc., (Tradax) both sell rice. A customer, Bar Schwartz Limited (Bar Schwartz), wanted to buy some rice and pay for it with a commercial letter of credit. But Bar Schwartz could not buy rice from Howell because Howell would not accept the commercial letter of credit as payment. This means of payment was acceptable to Tradax, but Bar Schwartz refused to buy rice from Tradax for reasons of its own. So, Howell and Tradax came up with a plan — Tradax would sell its rice to Bar Schwartz…