John B. Ordille Inc. v. Lenny Perry's Produce

U.S. DISTRICT COURT
WESTERN DISTRICT OF NEW YORK
Trusts and Estates

New York Law Journal

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District Judge William Skretny

Wendell Roberson Farms Inc. and Weis-Buy filed with the bankruptcy court proofs of claim under the Perishable Agricultural Commodities Act to which debtor Lenny Perry's Produce objected. Wendell's $5,579 proof of claim was supported by six invoices for shipments of produce made to Lenny in 2008. District court adopted a bankruptcy judge's recommendations that Lenny's objections to Wendell's claim be sustained and the claim be stricken entirely, and also that Weis-Buy's $56,000 claim be denied to the extent it sought legal fees and collection costs. Discussing American Banana v. Republic Nat'l Bank of N.Y., the court accepted the bankruptcy judge's determination that Wendell did not secure its trust rights because Wendell extended to Lenny—via its invoices offering a term of "Net 30" from invoicing—a payment term exceeding 30 days. Distinguishing Stowe Potato Sales v. Terry's Inc, the court rejected Wendell's urging that because it did not memorialize the "Net 30" payment term in a pre-transaction agreement, it could unilaterally offer to extend payment more than 30 days after a buyer accepts a delivery without jeopardizing its trust rights.

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