Six Rivers National Bank v. Lancaster (In Re Lancaster)

Memorandum of Decision

ALAN JAROSLOVSKY, Bankruptcy Judge.

In its complaint in this adversary proceeding, plaintiff Six Rivers National Bank alleges that debtors and defendants falsely represented that they owned an item of personal property which they pledged as security for a loan. It accordingly asserts that it is entitled to a nondischargeable judgment for fraud pursuant to § 523(a)(2) of the Bankruptcy Code.

After default, the Bank repossessed and disposed of its other personal property collateral but failed to give the Lancasters notice of the sale as required by California Commercial Code…