Grogan v. Harvest Capital Co. (In re
Grogan), 476 B.R. 270 (Bankr. D. Or. 2012) –
In Grogan, the debtors planted and harvested Christmas
trees. The bankruptcy court was called upon to determine
whether the debtors could exercise their "strong arm"
powers under Section 544(a) of the Bankruptcy Code to trump the
liens of two of their lenders on the Christmas trees.
Both lenders had loans secured by a combined mortgage and
security agreement. Both mortgages were recorded and both
lenders filed UCC financing statements. Grogan
turned on (1) the relative priority of a real estate mortgage and a
judgment lien with the priority of a UCC Article 9 security
interest, and (2) the sufficiency of a collateral description for
purposes of a UCC Article 9 security agreement.
