In re Camareno

105 F. App’x 3 (2004)

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In re Camareno

United States Court of Appeals for the Fifth Circuit
105 F. App’x 3 (2004)

  • Written by Heather Whittemore, JD

Facts

Worry Free Services, Inc. (creditor) installed an air conditioning and heating system in the home of Linda M. Camareno (debtor). Worry Free retained a security interest in the system and filed a financing statement with the secretary of state of Texas as it believed it was required to do by Article 9 of the Uniform Commercial Code. Later, Camareno filed for bankruptcy. Worry Free filed a claim for the system in the bankruptcy estate, citing its perfected security interest. Camareno filed a motion to avoid Worry Free’s claim, asserting that Worry Free did not have a valid security interest in the system. Camareno reasoned that the system was a fixture that was subject to § 53 of the Texas Property Code rather than Article 9. Under § 53, a contractor with a lien in a fixture was required to file an affidavit describing its lien with the relevant county clerk’s office. Worry Free opposed the motion, arguing that the system was personalty rather than a fixture, and that its filing was sufficient to perfect its security interest. The bankruptcy court found that the system was a fixture and that Worry Free had failed to satisfy the requirements imposed by § 53. Accordingly, the bankruptcy court granted Camareno’s motion to avoid Worry Free’s claim. The district court affirmed the bankruptcy court. Worry Free appealed.

Rule of Law

Issue

Holding and Reasoning (Per curiam)

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