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Dewsnup v. Timm

United States Supreme Court
502 U.S. 410 (1992)


Facts

Timm (creditor) loaned Aletha Dewsnup (debtor) money in exchange for liens on Dewsnup’s farmland. Dewsnup defaulted and filed for chapter 7 bankruptcy before Timm could complete a foreclosure sale. Dewsnup filed a petition in the Bankruptcy Court for the District of Utah to avoid a portion of Timm’s lien to the extent that the debt was greater than the fair market value of the farmland. Dewsnup requested the bankruptcy court reduce the debt to equal the fair market value under section 506(d) of the Bankruptcy Code, which states a claim that “is not an allowed secured claim” is void. The bankruptcy court denied Dewsnup’s petition. The district court and the United States Court of Appeals for the Tenth Circuit affirmed. The United States Supreme Court granted certiorari.

Rule of Law

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Issue

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Holding and Reasoning (Blackmun, J.)

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Dissent (Scalia, J.)

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