All-Tex, Inc. v. Branford Partners, LLC (In Re Branford Partners, LLC)

NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS FILED
FOR THE NINTH CIRCUIT MAR 25 2010
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
In re: BRANFORD PARTNERS, LLC, No. 08-60052
Debtor, BAP No. CC-08-1021-PaMkK
MEMORANDUM *
ALL-TEX, INC.,
Appellant,
v.
BRANFORD PARTNERS, LLC; BERT F.
FORNACIARI, individually and as co-
trustee of the Fornaciari Family Revocable
Truste Dated January 15, 2002; LINDA
COX FORNACIARI, individually and as
co-trustee of the Fornaciari Family
RevocableTrust dated January 15, 2003;
CALIFORNIA ENVIRONMENTAL
REDEVELOPMENT FUND; MCOM,
LLC,
Appellees.
Appeal from the Ninth Circuit
Bankruptcy Appellate Panel
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
Pappas, Klein, and Markell, Bankruptcy Judges, Presiding
Argued and Submitted March 4, 2010
Pasadena, California
Before: CANBY, GOULD and IKUTA, Circuit Judges.
We have jurisdiction to review the decision of the Bankruptcy Appellate
Panel under 28 U.S.C. § 158, and we affirm.
Branford Partners, LLC, was not required to plead in a separate adversary
proceeding its avoidance powers under 11 U.S.C. § 544 and § 545 as a defense to
All-Tex, Inc.’s alleged liens and interests in the property, and the bankruptcy court
properly treated Branford’s motion to dismiss as a motion for summary judgment.
See Fed. R. Bankr. P. 7001, 7012, 7056; Chbat v. Tleel (In re Tleel), 876 F.2d 769,
770 (9th Cir. 1989); Grove v. Mead Sch. Dist. No. 354, 753 F.2d 1528, 1532–33
(9th Cir. 1985).
A bona fide purchaser under California law would not have had constructive
or inquiry notice of All-Tex’s alleged liens and interests in the property because
All-Tex did not record its interests in the title record, did not file a lis pendens, and
did not have clear and open possession of the property in a manner that
contradicted record title. See, e.g., Robertson v. Peters (In re Weisman), 5 F.3d
417, 420–21 (9th Cir. 1993); Nat’l Bank of Alaska, N.A. v. Erickson (In re Seaway
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Express Corp.), 912 F.2d 1125, 1128–29 (9th Cir. 1990); Tleel, 876 F.2d at 772.
Neither the property’s possible use as a landfill nor the reference to the contract in
the city’s files would have put a reasonably prudent purchaser on constructive or
inquiry notice of the alleged liens and interests. See Probasco v. Eads (In re
Probasco), 839 F.2d 1352, 1355 (9th Cir. 1988).
The bankruptcy court did not err in concluding that Branford could avoid
All-Tex’s alleged liens and interests in the property, and that All-Tex could not
assert a separate claim for specific performance. See Weisman, 5 F.3d at 419–21;
see also Sherwood Partners, Inc. v. Lycos, Inc., 394 F.3d 1198, 1204 (9th Cir.
2005); Aslan v. Sycamore Inv. Co. (In re Aslan), 909 F.2d 367, 370–71 (9th Cir.
1990).
AFFIRMED.
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