11 U.S. Code § 544 - Trustee as lien creditor and as successor to certain creditors and purchasers
(a)
The trustee shall have, as of the
commencement of the case, and without regard to any knowledge of the
trustee or of any creditor, the rights and powers of, or may avoid any
transfer of property of the debtor or any obligation incurred by the
debtor that is voidable by—
(1)
a creditor that extends credit to the
debtor at the time of the commencement of the case, and that obtains, at
such time and with respect to such credit, a judicial lien on all
property on which a creditor on a simple contract could have obtained
such a judicial lien, whether or not such a creditor exists;
(2)
a creditor that extends credit to the
debtor at the time of the commencement of the case, and obtains, at such
time and with respect to such credit, an execution against the debtor
that is returned unsatisfied at such time, whether or not such a
creditor exists; or
(3)
a bona fide purchaser of real property,
other than fixtures, from the debtor, against whom applicable law
permits such transfer to be perfected, that obtains the status of a bona
fide purchaser and has perfected such transfer at the time of the
commencement of the case, whether or not such a purchaser exists.
(b)
(1)
Except as provided in paragraph (2),
the trustee may avoid any transfer of an interest of the debtor in
property or any obligation incurred by the debtor that is voidable under
applicable law by a creditor holding an unsecured claim that is
allowable under section
502 of this title or that is not allowable only under section
502
(e) of this title.
(2)
Paragraph (1) shall not apply to a transfer of a charitable contribution (as that term is defined in section
548
(d)(3)) that is not covered under section
548
(a)(1)(B), by reason of section
548
(a)(2).
Any claim by any person to recover a transferred contribution described
in the preceding sentence under Federal or State law in a Federal or
State court shall be preempted by the commencement of the case.
Source
(Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2596; Pub. L. 98–353, title III, § 459,July 10, 1984, 98 Stat. 377; Pub. L. 105–183, § 3(b),June 19, 1998, 112 Stat. 518.)
Historical and Revision Notes
legislative statements
Section
544
(a)(3)
modifies similar provisions contained in the House bill and Senate
amendment so as not to require a creditor to perform the impossible in
order to perfect his interest. Both the lien creditor test in section
544
(a)(1), and the bona fide purchaser test in section
544
(a)(3)
should not require a transferee to perfect a transfer against an entity
with respect to which applicable law does not permit perfection. The
avoiding powers under section
544
(a)(1), (2), and (3) are new. In particular, section
544
(a)(1)
overrules Pacific Finance Corp. v. Edwards, 309 F.2d 224 (9th Cir.
1962), and In re Federals, Inc., 553 F.2d 509 (6th Cir. 1977), insofar
as those cases held that the trustee did not have the status of a
creditor who extended credit immediately prior to the commencement of
the case.
The House amendment deletes section 544(c) of the House bill.
senate report no. 95–989
Subsection (a) is the “strong arm clause”
of current law, now found in Bankruptcy Act § 70c [section 110(c)
of former title 11]. It gives the trustee the rights of a creditor on a
simple contract with a judicial lien on the property of the debtor as of
the date of the petition; of a creditor with a writ of execution
against the property of the debtor unsatisfied as of the date of the
petition; and a bona fide purchaser of the real property of the debtor
as of the date of the petition. “Simple contract” as used here is
derived from Bankruptcy Act § 60a(4) [section 96(a)(4) of former
title 11]. The third status, that of a bona fide purchaser of real
property, is new.
Subsection (b) is derived from current
section
70e [section 110(e) of former title 11]. It gives the trustee the rights
of actual unsecured creditors under applicable law to void transfers.
It follows Moore v. Bay, 284 U.S. 4 (1931), and overrules those cases
that hold section
70e gives the trustee the rights of secured creditors.
Amendments
1998—Subsec. (b). Pub. L. 105–183designated
existing provisions as par. (1), substituted “Except as provided in
paragraph (2), the trustee” for “The trustee”, and added par. (2).
1984—Subsec. (a)(1). Pub. L. 98–353, § 459(1), inserted “such” after “obtained”.
Subsec. (a)(2). Pub. L. 98–353, § 459(2), substituted “; or” for “; and”.
Subsec. (a)(3). Pub. L. 98–353,
§ 459(3), inserted “, other than fixtures,” after “property”, and
“and has perfected such transfer” after “purchaser” the second place it
appeared.
Effective Date of 1998 Amendment
Pub. L. 105–183, § 5,June 19, 1998, 112 Stat. 518, provided that: “This Act [amending this section and sections
546,
548,
707, and
1325 of this title and enacting provisions set out as notes under this section and section
101
of this title] and the amendments made by this Act shall apply to any
case brought under an applicable provision of title 11, United States
Code, that is pending or commenced on or after the date of enactment of
this Act [June 19, 1998].”
Effective Date of 1984 Amendment
Amendment by Pub. L. 98–353effective with respect to cases filed 90 days after July 10, 1984, see section 552(a) ofPub. L. 98–353, set out as a note under section
101 of this title.
Construction of 1998 Amendment
Pub. L. 105–183, § 6,June 19, 1998, 112 Stat. 519, provided that: “Nothing in the amendments made by this Act [amending this section and sections
546,
548,
707, and
1325 of this title] is intended to limit the applicability of the Religious Freedom Restoration Act of 1993 (42 U.S.C. 2002bb [2000bb] et seq.).”
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The most recent Classification Table update that we have noticed was Tuesday, August 13, 2013
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