Flowers v. American Finance Co. (In re Flowers)

51 B.R. 710, 1985 Bankr. LEXIS 5898

• Court: District Court, W.D. Pennsylvania
• Decided: June 21, 1985
• Docket: Bankruptcy No. 82-00380
• Status: Published

Opinion

MEMORANDUM AND ORDER

WM. B. WASHABAUGH, Jr., Bankruptcy Judge,

This case involves an application of the debtors to avoid a lien against their household furniture of the American Finance Company perfected by the filing of a financing statement December 16, 1977 in Erie County, Pennsylvania Secured Transaction Index No. 516966 and any revivals thereof.

The Revised Bankruptcy Code was enacted November 6, 1978 and provided for an effective date of October 1, 1979. For the first time in history, debtors were given the right to avoid liens to the extent they impaired their exemption rights under Section 522 of said Code. The Supreme Court ruled in United States v. Security Industrial Bank, et al, 459 U.S. 70, 103 S.Ct. 407, 74 L.Ed.2d 235 (1982) that the provision relied on by the debtors in seeking the relief under 11 U.S.C. § 522(f) is unconstitutional insofar as it relates to liens acquired against a debtor before the enactment date of said legislation, November 6, 1978.

It is ORDERED, ADJUDGED and DECREED that the within application of the debtors to avoid the lien of the American Finance Company be, and the same hereby is, denied and dismissed as the involved lien was perfected before the enactment date of the Code.