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6500 Cherrywood Ln - Greenbelt, MD 20770 - Main Tel: 301-344-8018 map
101 W Lombard St Room 8530 - Baltimore, MD 21201 - Main Tel: 410-962-2688

This case came before the court on cross motions for summary judgment. Plaintiff, the Chapter 7 Trustee appointed to Debtor’s bankruptcy case, filed a Complaint against the Defendant seeking to avoid a payment made by the Debtor to the Defendant as a preference pursuant to 11 U.S.C. § 547(b). The payment was for work performed by the Defendant pursuant to a sub-contract agreement between Debtor, as general contractor, and Defendant, as subcontractor. Defendant defended against the preference action by asserting that the Debtor’s estate lost no value as a result of the payment because if the Debtor had not made the disputed payment, the bonding company, which furnished a payment bond for the project, would have been required to make the payment and would have therefore acquired a secured claim against the Debtor’s estate in the amount of the disputed payment. Finding the existence of genuine disputes of material facts, the court denied both motions for summary judgment.

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Duncan W. Keir