In re Abruzzese
United States Bankruptcy Court for the Eastern District of Virginia
252 B.R. 341 (1999)
- Written by Steven Pacht, JD
Facts
On June 26, 1998, Richard and Terry Abruzzese (debtors) purchased a Dodge van, which they partially financed with a loan from the dealer. The dealer subsequently assigned the loan to Mercury Finance Company of Virginia (Mercury) (creditor). The Abruzzeses took possession of the van on June 26. On July 22, the dealer filed an application for title to the van with the Virginia Department of Motor Vehicles (DMV). The title application identified Mercury as holding a lien on the van. Because the Abruzzeses owed past-due debts to the DMV, the DMV did not issue title to the Abruzzeses until October 15. On November 13, the Abruzzeses filed for Chapter 7 bankruptcy. The bankruptcy trustee filed a complaint against Mercury, seeking to avoid Mercury’s lien as an avoidable preference that arose fewer than 90 days before the Abruzzeses filed for bankruptcy. Per the trustee, Mercury’s lien was not perfected until the DMV issued title on October 15. Mercury responded that its lien was perfected on July 22, when the Abruzzeses asked the DMV to issue a title listing Mercury as a lienholder. The court conducted a trial.
Rule of Law
Issue
Holding and Reasoning (Tice, C.J.)
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