Mano-Y & M, Ltd. v. Field (In Re Mortgage Store, Inc.)

Appellant Mano-Y & M, Ltd. (“Mano”) appeals from the judgment of the district court holding that under 11 U.S.C. § 550 Mano was the initial transferee of $311,065.25 paid by the debtor, The Mortgage Store, Inc., in connection with the sale of a shopping plaza. We affirm.

I.

Mano owned the Raymondville Plaza, a six-acre shopping plaza in Raymondville, Texas. In 2008, Mano was approached by representatives of George Lindell (“Lin-dell”) who offered, on Lindell’s behalf, to buy the plaza. In mid-December 2008, Mano and Lindell entered into a contract for Mano to sell the plaza to Lindell for $2.2 million. Lindell was to pay $300,000 cash; the remainder of the purchase price was to be covered by a seller-financed mortgage. The contract obligated both parties to pay fees associated with closing. Additionally, Lindell was to pay $10,000 of the purchase price immediately as earnest money. The contract Was signed by Lin-dell and Paulrajan Manoharan on behalf of Mano.

The contract also assigned responsibilities to two third-parties. First, Sierra Title Company (“Sierra”), listed as the “title company” in the contract, was to take possession of the earnest money after the…