Hackler v. Arianna Holdings Co. (In re Hackler), 571 B.R. 662

Debtors own property at 339 West Lawrence Street, North Brunswick, NJ as tenants by the entireties.
Tax sale on June 25, 2013 awarded certificate to Phoenix Funding, Inc., which paid $13,500 and 0% interest.
Phoenix foreclosed years later; certificate assigned to Arianna Holding Company, LLC on May 9, 2016.
Final judgment of foreclosure entered Oct. 6, 2016, vesting title in Arianna.
Debtors filed Chapter 13 on Dec. 14, 2016; plan proposes paying Arianna’s claim in full.
Adversary proceeding followed seeking to avoid the October 6, 2016 transfer as a preferential or fraudulent conveyance.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the tax sale transfer is a §547(b) preference.	Debtors argue transfer satisfies §547(b) elements.	Arianna argues federalism concerns limit §547 reach via BFP.	Yes; transfer avoided as a preference.
Whether BFP controls §547(b) analysis.	Plaintiffs rely on BFP to restrict §547 breadth.	Arianna asserts BFP applies; or at least constrains §547.	BFP not controlling for §547(b); unambiguous §547(b) governs.
Whether state tax-foreclosure procedures undermine §547 analysis.	State procedures permit non-ambiguous value; tax sale equals value.	State law exemptions preclude federal fraudulent conveyance concerns.	State law does not defeat §547(b); preference avoidance permitted.

In re Pulcini, 261 B.R. 836 (Bankr. W.D. Pa. 2001) (discusses ambiguity and §547(b)(5) in mortgage foreclosures)
In re FIBSA Forwarding, Inc., 230 B.R. 334 (Bankr. S.D. Texas 1999) (expresses concerns about overlapping BFP rationale with §547)
BFP v. Resolution Trust Corp., 511 U.S. 531 (Supreme Court 1994) (defines ‘reasonably equivalent value’ in 548 context; federalism concerns)
In re Whittle Dev., Inc., 463 B.R. 796 (Bankr. N.D. Tex. 2011) (applies BFP distinctions to tax sale context)
In re Andrews, 262 B.R. 299 (Bankr. M.D. Pa. 2001) (addresses §547 applicability to tax-related transfers)