In the Matter of BEVILL, BRESLER & SCHULMAN ASSET MANAGEMENT CORPORATION, Debtor. SAUL S. COHEN, Trustee of Bevill, Bresler & Schulman Asset Management Corporation v. THE SAVINGS BUILDING & LOAN COMPANY, Appellant, 896 F.2d 54

Summary

Appellant and debtor transferred securities consisting of treasury bonds and a mortgage association pool to one another by repurchase agreements. After debtor filed a Chapter 11 bankruptcy action, appellee trustee sought to recover the securities from appellant. The district court granted summary judgment to appellee and denied appellant's summary judgment motion. On appeal, the court affirmed in part and reversed in part. Appellant's claim was a claim for a settlement payment arising out of a repurchase agreement and was within 11 U.S.C.S. § 362(b)(7). Appellant had a right of setoff for the treasury bonds. The principal and interest payments on the mortgage association pool and the interest coupons on the treasury bonds, however, did not constitute mutual debts subject to setoff because appellant was merely a trustee holding the funds for debtor, who was the true owner of the trust res.