FOR THE NORTHERN DISTRICT OF CALIFORNIA
DONALD and CAROL BADE, No. 91-10976
SCOTT LABORATORIES, INC.,
v. A.P. No. 91-1186
DONALD and CAROL BADE,
Memorandum of Decision
On January 14, 1991, plaintiff Scott Laboratories obtained a temporary protective order
regarding the debtors' home. On February 5, 1991, Scott recorded a notice of attachment. The
first date is outside the 90-day preference period, but the second is not. The issue before the
court, on cross-motions for summary judgment, is whether Scott's interest is avoidable as a
Resolution of this case involves a simple application of the Bankruptcy Code. Section
547(b)(4)(A)(4) makes a transfer avoidable if made on or within 90 days before the petition was
filed. Section 547(e)(2)(B) provides that a transfer of real property is deemed to have taken
place at the time it is perfected if not perfected 10 days after the transfer takes effect between
the transferor and the transferee. Section 547(e)(1)(A) provides that a transfer of real property
is perfected when a bona fide purchaser cannot require a superior interest.
The recording of the notice of attachment cannot relate back to the temporary protective
order because more than ten days had passed since it became effective between Scott and the
Bades. Until the notice of the writ was recorded, a bona fide purchaser would have had
superior rights. Accordingly, the transfer is deemed by law to have been made on February 5, 1991.
Scott's reliance on In re Wind Power Systems, Inc.
, 841 F.2d 288 (9th Cir.1988), is entirely
misplaced. That case did not involve real property, and was accordingly decided by applying
section 547(e)(1)(B). In this case, section 547(e)(1)(A) applies.
There appearing to be no other disputed issues of fact, judgment will be entered in favor of
the debtors, as debtors in possession, and against Scott. The estate shall recover its costs of suit.
Counsel for the Bades shall submit an appropriate form of judment.
Dated: March 27, 1992 _______________________