Court: United States Bankruptcy Court, M.D. Florida; May 25, 2007; Us Bankruptcy; United States Bankruptcy Court
The court is reviewing the Trustee's Motion to Dismiss the Bank's Amended Counterclaim in a bankruptcy case initiated by Susan K. Woodard, the Chapter 7 Trustee. The Trustee's complaint seeks to avoid and recover preferential and fraudulent transfers made to Synovus Bank and Dale F. Alford, Sr. The Bank's Amended Counterclaim claims an equitable lien on the Debtor's interest in certain real property, asserting that the Debtor, Dale F. Alford, Jr., liquidated assets of his company, Mercury Technology Services, Inc. (MTS), without the Bank's consent and agreed to convey his equity in the property to the Bank due to this improper liquidation.
The background details include a Loan Agreement from August 20, 2002, where MTS borrowed $270,000 from the Bank, secured by a mortgage limited to $100,000 and intangible taxes of $200. The property was sold for $410,000 on August 30, 2005, with the Bank receiving $170,863.10. The Trustee argues that this payment exceeds the secured interest, characterizing it as a voidable preference under bankruptcy law, while the Bank asserts it is entitled to the full loan balance due to the Debtor's actions.
The Trustee seeks dismissal of the Amended Counterclaim on three grounds: lack of standing, failure to plead fraud with specificity, and failure to state a valid claim. The discussion highlights the contention that the Bank's claim for the additional amount received beyond the mortgage limit constitutes payment for an unsecured debt.
The Trustee aims to avoid the transfer of an excess payment as a preferential transfer under § 547(b) of the Bankruptcy Code. The Bank, through its Counterclaim, seeks to convert a $70,863.10 unsecured debt into a secured claim, arguing it is entitled to an equitable lien on the Real Property or its proceeds due to the Debtor's misconduct. The property was sold prepetition on August 30, 2005, and the Bank acknowledges that it is requesting the Court to recognize an equitable lien as of the closing date. If the debt is deemed secured, the payment exceeding $100,000 would not meet the criteria for a voidable preference under § 547.
Despite challenges to the Bank's claim, the Court finds that the Trustee's Motion to Dismiss the Amended Counterclaim should be denied. The Court previously outlined the conditions under Florida law for imposing an equitable lien and considered the Bank's claims of conversion and deceit by the Debtor. Although the Real Property was sold prior to the petition, and the Bank is pursuing a remedy against property not part of the bankruptcy estate, the Court allowed for the possibility of an equitable lien based on the Bank's amended claims.
The Amended Counterclaim states the Bank is seeking an equitable lien on the Debtor's interest in the Real Property and its proceeds, which parallels the Trustee's efforts to recover the same amount as a preferential transfer. Under § 541(a)(3) and § 550 of the Bankruptcy Code, the Bank's claim may involve property that is currently or may become part of the estate. Given these developments, the Court concludes that the Bank may be able to substantiate its claim for an equitable lien, leading to the denial of the Trustee's Motion to Dismiss. The order concludes with the motion being denied.
