Attempt To Characterize Secured Financing As Express Trust Fails To Persuade Montana Bankruptcy Court

LexisNexis (February 4, 2021, 2:25 PM EST) -- Bankruptcy courts are probably the only courts in which motions related to stays involve interesting legal issues with any regularity. Case in point: A recent bankruptcy decision from the District of Montana considered—on a motion to modify stay—whether a “Wholesale Financing Agreement” (“WFA”) and a “Wholesale Finance Security Agreement” (“WFSA”) created a creditor-debtor relationship or an express trust. The decision, which holds that a secured financing rather than a trust was created, contains solid analysis of a number of frequently encountered Article 9 issues. The case is In re Hawaii Motorsports, LLC, 2020 Bankr. LEXIS 3428 (Bankr. D. Mont. Dec. 7, 2020)....