In Re: James Knittle Hesser and Doris Marie Hesser, Debtors. William N. Webb, Trustee v. General Motors Acceptance Corporation, a New York Corporation

CAMPOS, District Judge.

In this appeal we are required to construe 11 U.S.C. § 547 of the Bankruptcy Code to determine the applicable method and timing of the perfection of a security interest for purposes of preferences in bankruptcy. The Bankruptcy Court entered judgment for the Trustee and, on appeal, the District Court affirmed. It held that the ten-day grace period provided in §§ 547(c)(3) and (e)(2) overrides § 547(e)(1) which directs that the date and method of perfection is as provided in state statutes. We disagree and reverse.

I. STATEMENT OF THE CASE

The relevant facts are undisputed.…