Sims

This case involves an adversary proceeding stemming from transactions apparently taken in contemplation of the bankruptcy of Lendvest Mortgage, Inc. (“Lendvest”). The Trustee in bankruptcy of Lendvest seeks recovery of an allegedly preferential transfer to Appellants Willard and Norma DeArmond, who were investors in Lendvest. The Trustee previously settled an action with the recipient of the monies, Lendvest Mortgage Fund II (“Fund II”), that involved claims for the same preferential transfer. Based on its conclusion that the entire settlement with Fund II should be applied as satisfaction for the preferential transfer claim, the bankruptcy court dismissed the adversary proceeding because the Trustee had already recovered once on the claim now asserted against the DeArmonds. Sims v. De Armond (In re LendVest Mortgage, Inc.), 123 B.R. 623 (Bankr.N.D.Cal.1991). The Bankruptcy Appellate Panel (“BAP”) reversed. We affirm the holding of the BAP.

I. JURISDICTION

A motions panel has previously decided that there is jurisdiction to hear this appeal. “While we give deference to motions panel decisions made in the course of the same appeal, this court has an independent duty to decide…