IN RE: LARRY E. WAGNER, Debtor; LARRY E. WAGNER and RONDA J. WINNECOUR, Trustee, Plaintiffs, v. CHRISTIANA BANK & TRUST COMPANY as Owner Trustee for Security National Funding Trust, Defendant., 353 B.R. 106

Summary

The first issue was whether the Trustee and debtor, collectively or individually, possessed standing to prosecute the pending avoidance action pursuant to 11 U.S.C.S. § 544. Although the court found that the Trustee had standing to prosecute the avoidance claim, proof of her ability to avoid the mortgage under applicable Pennsylvania law pursuant to § 544(a)(3) was unclear based on the current record. The undisputed facts supported a finding that the Trustee possessed "record notice" of the filing of the mortgage. However, the effect of the property description contained in that document vis-a-vis the Trustee's status as a bona fide purchaser had not been completely established by either party. A title search of debtor's property would have disclosed to the reasonable title searcher the existence of the properly recorded mortgage but questions persisted as to whether it actually encumbered the "Mattie Road Property" in light of the conflicting property descriptions and inaccurate ...