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Commercial Law Keyed to Zierdt, 1st Ed.
In re Wallman
Citation:
71 B.R. 125 (1987)Facts
Approximately one year prior to filing for Chapter 11 bankruptcy relief on January 20, 1983, Wallman executed a promissory note and security agreement with FmHA in exchange for a loan. The security agreement granted FmHA a security interest in all crops “now planted, growing or grown, or which are hereafter planted or otherwise become growing crops.” FmHA properly perfected this security interest. In 1986, while still in the process of reorganizing, Wallman planted and harvested a wheat crop. On November 15, 1986, Wallman delivered a portion of this crop to Yale Elevator and received a check for $9,983 made payable to both himself and FmHA. FmHA claimed a lien interest in the proceeds from the sale of the 1986 crop based on its prepetition security agreement, while Wallman contended that Bankruptcy Code Section 552 extinguished FmHA’s security interest in crops planted after the petition date.
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