Stahl
Stahl v. Whelan Electric, Inc. (In re Modtech Holdings, Inc.)
Opinion
Lead Opinion
Donovan, J.
MEMORANDUM DECISION AFTER TRIAL
INTRODUCTION
Plaintiff Alberta P. Stahl, in her capacity as the chapter 7 trustee for the bankruptcy estate of Modtech Holdings, Inc. (Mod-tech or Debtor), seeks to avoid alleged preferential transfers made to Whelan Electric, Inc. (Defendant or Whelan). At the time of the transfers, Modtech was a contractor for various California school districts. Modtech subcontracted with Defendant to provide work, labor and materials to projects for the Palos Verdes Unified School District (Palos Verdes), the Vista Dual Magnet School (Vista Dual) and the Los Angeles Community College (LACC) (collectively, Projects). On October 2, 2008, Defendant received a $75,000 check from Modtech. In addition, Defendant executed and served various stop notices on the Projects and issued several releases of the stop notices in the ninety days prior to Modtech’s filing. Modtech filed for bankruptcy on October 20, 2008 (Petition Date).
Plaintiff asserts that Defendant received avoidable preferential transfers on October 2, 2008 that should be avoided pursuant to 11 U.S.C. § 547 (b). 1 Defendant argues in opposition that the $75,000 payment was received in the ordinary course…