Brief Fact Summary. The National Bank of Alaska, (Appellant), appeals a decision of the Bankruptcy Appellate Panel granting summary judgment to Erickson, trustee in the bankruptcy of Seaway Express Corp., (Seaway). Appellant claims a priority interest in property owned by Seaway.
Synopsis of Rule of Law. To perfect an interest in real property under Washington law, a party must record a deed signed by the grantor. An unrecorded interest in property is not binding on a subsequent purchaser in good faith.
We necessarily act very cautiously in exercising such a relatively undefined equitable power in favor of one group of potential creditors at the expense of other creditors, for ratable distribution among all creditors is one of the strongest policies behind the bankruptcy laws.View Full Point of Law
Issue. Whether Appellant’s perfected security interest in the AFFS account extended to the Auburn Property.
Held. No. Appellant’s perfected security interest in the AFFS account did not extend to the Auburn Property because the terms of the U.C.C. do not extend to real property.
Discussion. The U.C.C. by its terms does not extend to real property. To perfect an interest in real property, a party must record a deed signed by the grantor. Appellant did not record a deed signed by the grantor. Therefore its interest in the property was unperfecte.