OPINION
Debtor Maxwell Communication Corporation pic (“MCC” or the “Debtor”) and Examiner Richard A. Gitlin (the “Examiner”) appeal from final judgments of the bankruptcy court for the Southern District of New York, Tina L. Brozman, J., dismissing Adversary Complaints filed by MCC and the Examiner against defendants/appellees Barclays Bank pie (“Barclays”), National Westminster Bank pic (“NatWest”), and Societe General (“SocGen”). 1 The three Complaints sought to avoid and recover certain transfers made by MCC to Defendants within 90 days prior to the commencement of MCC’s Chapter 11 case and to disallow claims filed by the Defendants against the Debtor’s bankrupt estate.
The bankruptcy court dismissed the Complaints pursuant to Fed.R.Civ.P. 12(b)(6), holding that the general presumption against extraterritoriality and considerations of comity prevented utilization of § 547 of the Bankruptcy Code, 11 U.S.C. § 101 et seq., to avoid the pre-petition transfers. On appeal, MCC and the Examiner contend that the transfers were not extraterritorial in nature, and that, even if they were, Congress clearly intended that § 547 apply extraterritorially. MCC and the Examiner also argue that considerations of comity did not require the bankruptcy court to dismiss the Complaints. For the reasons set forth below, I disagree with appellants and affirm the judgment of the bankruptcy court.
I. Background
The facts underlying the Complaints are fully set forth in the bankruptcy court’s decision and need not be repeated here except for a brief summary.
2
MCC is an English company that, prior to its Chapter 11 case, functioned primarily as a holding company for a variety of publishing and information service businesses located throughout the world. Approximately 80% of MCC’s total asset pool and its largest sources of revenue consisted of its ownership of two American entities, MacMillan, Inc. (“MacMillan”) and Official Airlines Guide, Inc. (“OAG”). How
Barclays and NatWest are English Companies which maintain their principal offices in London, although both banks have branch offices in the United States. SoeGen is a French banking institution headquartered in Paris, France with branch offices in London and New York. All three defendants are in the business of providing banking and financial services throughout the world and provided MCC with credit facilities to service its working capital needs. These credit facilities, which were administered and drawn upon by MCC in London prior to its bankruptcy filings, helped MCC finance its purchases of Macmillan and OAG in 1988.
A. The Bankruptcy Filings
The unique aspect and the most important feature of this case for purposes of these appeals is MCC’s parallel bankruptcy filings in the courts of two nations. On December 16, 1991, MCC filed a Chapter 11 petition in the Southern District of New York. On December 17, 1991, MCC presented a petition to the High Court of Justice in London for an administration order under the Insolvency Act 1986. Because the dual filings commenced plenary insolvency proceedings in the U.S. and England, the U.S. bankruptcy court appointed an Examiner whose “mandate was to harmonize the two proceedings so as to permit a reorganization under U.S. law which would maximize the return to creditors.”
In re Maxwell,
The Joint Administrators and the Examiner subsequently entered into a procedural “Protocol” in order to coordinate their efforts. The Protocol enumerates the respective powers and duties of the Joint Administrators and the Examiner and provides the basis for the “Plan of Reorganization” (“Plan”) filed in U.S. bankruptcy court and “Scheme of Arrangement” (“Scheme”) filed in the High Court in England. The Plan and Scheme, which set forth the debtor’s post-reorganization obligations to its creditors, are mutually interdependent documents that “constitute a single mechanism, consistent with the laws of both countries, for reorganizing MCC.” In re Maxwell, 170 B.R. at 802. The documents create a single pool of assets and permit creditors to file claims in either jurisdiction which suffice for participation under both the Plan and Scheme. However, the choice of law and forum issues which are the subject of this appeal were explicitly not decided in these documents: MCC’s Disclosure Statement — submitted in connection with creditor voting on the Plan and Scheme — expressly recognized that the appropriate forum for a given claim is to be decided on a “case-by-case” basis. See Disclosure Statement at p. 133. In addition, § 6.04 of the Plan states that the Joint Administrators shall consult with the Examiner on “whether or in which court to assert a particular claim” and on “choice of law” matters, while the Scheme states that the word “court” in both the Plan and Scheme means “the English Court or the U.S. Court, as is the more appropriate forum in the particular ease.” Plan of Reorganization at § 6.04; Scheme of Arrangement at Annexure 1 (Definitions).
B. The Transfers
Before it filed for bankruptcy protection, MCC sold significant portions of its U.S. assets in an attempt to reduce some of the debt it had incurred in acquiring Macmillan and OAG. Specifically, Macmillan sold its “Directories” division for $145 million and Computer Book Publishing, a subsidiary, for $157.5 million. As detailed in the bankruptcy court’s opinion, portions of the sale proceeds were used to repay MCC’s overdraft balances on its accounts with the Banks in London. These transfers, which occurred within 90 days of MCC’s bankruptcy filings, consisted of transfers of over $30 million dollars and over 2 million pounds to Barclays, over 71.5 million pounds to NatWest, and over 5.7 million pounds to SocGen.
See In re Maxwell,
SoeGen is the only defendant to dispute that it received loan payments from the sale proceeds of MCC’s U.S. assets. Unlike the Adversary Complaints filed against Bar-
C. The Complaints And The Bankruptcy Court’s Decision
After the Banks filed notices of claim in England, MCC filed Adversary Complaints, pursuant to 11 U.S.C. §§ 547 and 550, to recover the transfers made to the Banks and to disallow their claims pursuant to 11 U.S.C. § 502(d). Section 547(b) provides in pertinent part:
Except as provided in subsection (c) of this section, the trustee may avoid any transfer of an interest of the debtor in property—
(1) to or for the benefit of a creditor;
(2) for or on account of an antecedent debt owed by the debtor before such transfer was made;
(3) made while the debtor was insolvent;
(4) made—
(A)on or within 90 days before the filing of the petition ... [and]
(5)that enables such creditor to receive more than such creditor would receive if—
(A) the case were a case under Chapter 7 of this title;
(B) the transfer had not been made; and
(C) such creditor received payment of such debt to the extent provided by the provisions of this title.
The Banks then moved, pursuant to Fed. R.Civ.P. 12(b)(6), to dismiss the complaints for failure to state a claim upon which relief could be granted.
3
The Banks alleged that the transfers were extraterritorial in nature, and that the presumption against the extraterritorial application of federal statutes as well as considerations of comity precluded the use of § 547 to avoid the transfers. The Banks also argued that an English court applying English law should adjudicate the preference claims, a contention obviously motivated by the differences between U.S. and English preference law. In order for a transfer to be avoidable as a preference under English law, the debtor must subjectively intend to put the transferee into a better position than the transferee would have otherwise enjoyed as a creditor.
See In re Maxwell,
The bankruptcy court dismissed the Complaints. See
In re Maxwell,
What I do hold is that where a foreign debtor makes a preferential transfer to a foreign transferee and the center of gravity of that transfer is overseas, the presumption against extraterritoriality prevents utilization of § 547 to avoid the transfer.
Id. at 814. Finally, the court held in the alternative that considerations of comity precluded the use of § 547 to avoid the transfers. The instant appeals followed.
II. Discussion
This Court has appellate jurisdiction over the three appeals pursuant to 28 U.S.C. § 158(a). The bankruptcy court’s decision to dismiss the complaints for failure to state a claim is reviewed
de novo. See Rent Stabilization Ass’n v. Dinkins,
A. The Presumption Against Extraterritoriality
MCC and the Examiner contend that the bankruptcy court erred in holding that the presumption against extraterritoriality precluded the use of § 547 to avoid the transfers to the Banks. The presumption is a “longstanding principle of American law ‘that legislation of Congress, unless a contrary intent appears, is meant to apply only within the territorial jurisdiction of the United States.’”
Equal Employment Opportunity Comm. v. Arabian American Oil Co.,
A two-fold inquiry is required when attempting to apply the presumption in a specific factual setting.
See Kollias v. D & G Marine Maintenance,
1. Are the transfers extraterritorial?
MCC and the Examiner contend that the transfers do not call for the extraterritorial application of U.S. law for two reasons. First, MCC and the Examiner argue that, because the money received by the Banks was derived from the sale of U.S. assets, the transfers have a substantial connection to the United States. Second, MCC and the Examiner contend that because the Banks seek a ratable share of MCC’s assets — the bulk of which consist of sale proceeds generated in the United States — the Banks have acquiesced in MCC’s Chapter 11 case and have subjected themselves to the equitable claims adjustment process of the bankruptcy code, of which § 547 is an integral part. See Transcript of Oral Argument, April 17, 1995 (“Tr.”) at p. 25. To appellants, the Banks’ participation in the claims adjustment process has “obvious, strong connections with the United States,” and should be considered the relevant conduct for purposes of an extraterritoriality analysis under § 547. MCC Reply Brief at p. 4.
The specific conduct proscribed by § 547 is the actual payments made to the Banks. Section 101(54) of the bankruptcy code defines “transfer” as:
every mode, direct or indirect, absolute or conditional, voluntary or involuntary, of disposing of or parting with property or with an interest in property ...
Because MCC actually parted with the transferred funds in England, it is possible to view the transfers as occurring wholly outside the borders of the U.S. However, such a limited conception of “transfer” for purposes of an extraterritoriality analysis would have potentially dangerous implications for the future application of § 547: a creditor — be it foreign or domestic — who wished to characterize a transfer as extraterritorial could simply arrange to have the transfer made overseas, a result made all too easy in the age of the multinational company and information superhighway. See MCC Reply Brief at p. 3 (“If accepted as a means of removing the U.S. connections from a transaction, the Banks’ use of overseas wire transfers would provide a roadmap for future attempts by creditors to evade United States Law.”). The fact that funds were electronically transferred to accounts in England is not, standing alone, sufficient to characterize the events as extraterritorial. 4
A more appropriate analysis of the relevant conduct under § 547 is to consider all component events of the transfers. For example, in
Gushi Bros. Co.,
Viewing the transfers in this manner clearly indicates that the transfers occurred overseas. First, MCC and the Banks are all foreign entities whose relationship was centered in England. Indeed, the antecedent debts underlying the transfers arose from MCC’s overdrafts on accounts maintained with the Banks in England and governed by English law. MCC repaid these debts by transferring the funds to these accounts in the U.K.
5
The only possible U.S. connections are that the transferred funds did consist of proceeds from the sale of U.S. assets and that the sales did deplete the U.S. assets available to satisfy the claims of all creditors against MCC. However, the source of the funds is at best only one component of the conduct proscribed by§ 547. Even assuming that the transfers were initiated in the U.S. after the U.S. assets were sold, this conduct is more appropriately characterized as a preparatory step to the transfers.
See Gushi Bros.,
Nor can the relevant conduct be considered the Banks’ “participation” in the Chapter 11 claims adjustment process. The Supreme Court has held that a creditor par-tieipates in the claims allowance process and subjects itself to the equity jurisdiction of the bankruptcy court when it files a proof of claim.
See Langenkamp v. Culp,
Moreover, the Plan and Scheme do not, as appellants contend, subject the Banks to the Chapter 11 claims adjustment process. While the Plan and Scheme constitute an integrated program for the filing and allowance of claims against MCC, those documents do not provide that filing a claim in one country subjects the creditor to the jurisdiction and laws of the other. For example, sections 6.06 and 6.07 of the Plan merely
Accordingly, the Banks have not participated as creditors in the U.S. proceeding and have not submitted to the claims adjustment process of the Bankruptcy Code, of which § 547 is an integral part. The relevant conduct for purposes of an extraterritoriality analysis is the transfers which, as discussed above, are clearly foreign transactions. Thus, the presumption against extraterritoriality, in the absence of explicit Congressional direction to the contrary, prevents the use of that section to avoid the transfers as preferential.
2. Did Congress intend § 547 to govern extraterritorial transfers?
An act of Congress will not be found to apply to conduct occurring outside the U.S. unless “ ‘the affirmative intention of the Congress’ ” to apply the law extraterrito-rially is “ ‘clearly expressed’ ” in the statute.
Aramco,
In
Kollias,
MCC and the Examiner argue that Congress clearly intended that § 547 apply to conduct occurring outside of the U.S and point to the plain language of § 547, the “comprehensive” nature of the code as a whole, a number of specific code provisions, and general bankruptcy policies which allegedly evince this intent. These arguments, while not without merit, do not meet MCC’s or the Examiner’s heavy burden of demonstrating that Congress unmistakably intended that § 547 apply extraterritorially.
First, nothing in the language or legislative history of § 547 expresses Congress’ intent to apply the statute to foreign transfers. MCC argues that the term “any transfer” in § 547(b) should be literally read to encompass any transfer, wherever consummated; however, broad, boilerplate language such as the term “any transfer” is insufficient to overcome the presumption against extraterritoriality.
See Aramco,
The “comprehensive” nature of the Code also does not serve to overcome the presumption against extraterritoriality. MCC and the Examiner contend that the Bankruptcy Code envisions three specific approaches to administering the assets of a foreign debtor. First, a foreign debtor may file for full Chapter 11 relief if it has property in the U.S. See 11 U.S.C. § 109(a). In addition, a foreign bankruptcy has two other alternatives: 11 U.S.C. § 304 authorizes a foreign debtor to seek “ancillary relief’ in aid of a “foreign proceeding,” including the enjoining of litigation in the U.S. against the debtor, and 11 U.S.C. § 305 authorizes the bankruptcy court to suspend or dismiss a foreign debtor’s case under certain circumstances. Unlike a full Chapter 11 case, these latter two alternatives do not give a foreign debtor the right to commence an avoidance action. MCC and the Examiner contend that these three alternatives constitute a comprehensive legislative scheme for dealing with foreign debtors holding property in the U.S., and if a debtor chooses to commence a full Chapter 11 ease, it is entitled to all of the rights — including the power to bring an avoidance action — that any debtor possesses.
This argument is flawed. While § 109 provides that a foreign debtor is entitled to full bankruptcy relief, that provision does not specify that U.S. law is applicable to all of the foreign debtor’s transactions. Moreover, simply because a foreign debtor may not bring an avoidance action in an ancillary proceeding under §§ 304 or 305 does not imply that the debtor has an unlimited ability to bring an avoidance claim in a plenary case under § 109. Finally, neither § 109 nor §§ 304 and 305 contemplate the situation involved in the present case in which there are plenary bankruptcy cases pending in the courts of two nations.
MCC and the Examiner also rely on § 541(a) of the Code which provides that:
[the] estate is comprised of all of the following property, wherever located and by whomever held:
... (3) Any interest in property that the trustee recovers under section ... 550 ... of this title.
(7) Any interest in property that the estate acquires after the commencement of the case.
Finally, the Code’s twin policies of discouraging dismemberment of financially distressed debtors and promoting equality of distribution among similarly situated creditors will not be undermined by a finding that the presumption against extraterritoriality has not been overcome. If § 547 does not apply to the transfers at issue, MCC and the Examiner contend that U.S. creditors will suffer in two respects: domestic creditors will still be subject to disgorgement of preferential transfers while foreign creditors like the Banks will not, and U.S. creditors will be deprived of their ratable share of the preferential payments received by the Banks. However, this argument assumes that all pre-insolvency transfers are avoidable, which is not the case; § 547(c) contains a number of exceptions to the power of a trustee to recover payments made by the debtor within 90 days of a bankruptcy filing. 8 In addition, the Code requires equal treatment of similarly situated creditors. English creditors who dealt with an English debtor in England are not similarly situated with U.S. creditors who dealt with the debtor in the U.S., especially where there are simultaneous insolvency proceedings pending in the two countries.
Of course, if the Adversary Complaints are dismissed, MCC may be unable to recover the'transfers to the Banks, who will in all probability receive further distributions from MCC’s remaining pool of assets. MCC and the Examiner correctly point out that while there may be two plenary insolvency proceedings — of which the Banks have only officially participated in one — there is only
one
group of assets available for distribution to MCC’s creditors. As the bankruptcy court noted, however, English preference policy is not that different than that of the U.S., and application of English law would thus not be so unfair as to require the use of U.S. law.
See In re Maxwell,
In sum, the appellants have failed to meet their burden of demonstrating that Congress intended that § 547 apply to foreign transfers. The Supreme Court has stated that “[w]hen it desires to do so, Congress knows how to place the high seas within the jurisdictional reach of a statute.”
Argentine Republic v. Amerada Hess Shipping Corp.,
3. The Domestic “Effects” Of The Transfers
MCC and the Examiner also argue that the effects of the transfers in the United States make the presumption against extraterritoriality inapplicable. In
Massey,
Barclays argues that the “effects” test is inapposite because a court should not apply the test unless it first determines that Congress intended to apply the relevant statute extraterritorially. This contention is not without merit. In the cases cited by
Massey,
“the ultimate touchstone of extraterritoriality consisted of an ascertainment of congressional intent; courts did not rest
solely
on the consequences [within the U.S.] of a failure to give a statutory scheme extraterritorial application.”
Subafilms. Ltd.,
In any event, it is unnecessary to reach the Congressional intent issue because the domestic effects of the transfers at issue here are insufficient to overcome the presumption. The “effects” within the U.S. of the transfers to the Banks are the reduction of MCC’s U.S. assets and the injuries to U.S. creditors or citizens. As to creditors, any impact is lessened where parallel insolvency proceedings exist in both the U.S. and U.K. and where all of MCC’s assets are pooled for the benefit of all creditors, most of whom are English.
See Laker Airways,
The bankruptcy court also held that, even assuming that the presumption against extraterritoriality had been overcome, principles of international comity mandated dismissal of the Complaints. Comity is a canon of statutory construction providing that “an act of Congress ought never to be construed to violate the law of nations if any other possible construction remains.”
See Hartford Fire Ins. Co. v. California,
— U.S. -,-,
Because comity is based on the respect sovereign nations afford each other by limiting the reach of their laws,
10
courts have naturally looked to international choice of law principles in attempting to apply this canon of statutory construction.
See, e.g., Romero v. Int’l Terminal Operating Co.,
The bankruptcy court clearly did not abuse its discretion in finding that traditional choice of law principles “point decidedly towards the application of U.K. law.”
In re Maxwell,
English bankruptcy law and policies are also implicated to a greater extent than corn-
Moreover, the bankruptcy court and High Court in England have conducted MCC’s insolvency proceedings in a spirit of cooperation, and deference to the English court would further previous efforts by both countries’ courts to harmonize the proceedings.
See In re Maxwell,
The appellants’ remaining arguments as to the bankruptcy court’s exercise of comity are without merit. MCC and the Examiner contend that a court may not invoke comity where Congress has demonstrated an intent to give a statute extraterritorial effect. Assuming that Congress has evinced this intent, however, does not bar a court’s decision to apply principles of comity. Comity is “wholly independent” of the presumption against extraterritoriality and applies even if the presumption has been overcome or is otherwise inapplicable.
Hartford Fire,
— U.S. at-,
The Examiner also argues that a “true conflict” must exist between U.S. and English preference law before a court can decline to apply U.S. law on comity grounds. In
Hartford Fire,
— U.S. at-,
The Hartford Fire approach seems particularly inappropriate in the context of the Bankruptcy Code. The Code does not impose a regulatory scheme that governs conduct in the same manner as the antitrust laws; rather, the Code is intended to redistribute assets in the event that insolvency proceedings are commenced. As the bankruptcy court aptly stated:
[0]ne cannot speak in terms of complying with both [U.S. and English preference] laws. Preferences are not proscribed under either country’s law; indeed, there isnothing inherently i evil about preferences and a debtor is entitled to prefer creditors prior to bankruptcy, although, "with the advent of bankruptcy, the preferences may be susceptible of avoidance.
In re Maxwell,
C. 11 U.S.C. § 502(d)
MCC and the Examiner also seek to disallow the transfers to the Banks pursuant to 11 U.S.C. § 502(d) which provides, in relevant part, that:
the court shall disallow any claim of any entity from which property is recoverable under section ... 550 ... or that is a transferee of a transfer avoidable under section ... 547 of this title ... unless such entity or transferee has paid the amount, or turned over any such property, for which such entity or transferee is liable under section ... 550 ... of this title.
Appellants contend that, even if § 547 is not available to avoid the transfers, § 502(d) may still be invoked to disallow the claims filed by the Banks in the U.K.
12
In order for a transferee’s claim to be disallowed under § 502(d), however, it must have received a “transfer avoidable” under § 547. Obviously, the Banks have not received a “transfer avoidable” under § 547 because that section does not apply to the payments to the Banks. In addition, § 502 only applies to the allowance and disallowance of claims filed under 11 U.S.C. § 501.
See Durham v. SMI Indus Corp.,
III. CONCLUSION
The judgment of the bankruptcy court is affirmed. The Adversary Complaints are dismissed for failure to state a claim upon which relief can be granted.
SO ORDERED.
Notes
. The Examiner was not a party to the Adversary proceeding against SocGen and therefore only appeals from the Orders dismissing the Complaints against Barclays and NatWest.
. The parties agree on almost all of the relevant facts for purposes of the appeals. The undisputed facts are set forth in the allegations of the Adversary Complaints and in affidavits and annexed exhibits submitted for the Court’s consideration by agreement of the parties.
See In re Maxwell Communication Corp. pic,
. Before the Joint Administrators and Examiner filed the Adversary Complaints, Barclays sought injunctive relief in England to prevent the Joint Administrators from commencing a preference suit in U.S. bankruptcy court under U.S. law. Although Barclays initially obtained an ex parte injunction, the English Court subsequently vacated the restraint and held that Judge Brozman was the proper person to decide whether to accept jurisdiction of a suit seeking to recover the transfer to Barclays. See Barclays Bank pic v. Holman, [1992] BCC 757 (July 28, 1992). The English judge also stated:
It is therefore sufficient for me to say that, having regard to the connecting factor provided by the source of the repayment money [MCC's sale of U.S. assets], a decision by the U.S. court to assert jurisdiction under § 547 would not in my judgment involve, according to English notions, so egregious a claim of extraterritoriality that justice requires that it should be prevented by injunction.
Id.
. Natwest’s citation of
Barnhill v. Johnson,
. As detailed by the bankruptcy court, MCC’s initial transfer to Barclays was made from an MCC Natwest account in London to Barclays’ branch in New York, through which all payments made to Barclays in dollars are routed. However, the funds were then immediately credited to the outstanding balance on MCC's London overdraft account with Barclays.
See In re Maxwell,
. The Banks have also pointed to Plan § 6.09, which provides that
[n]o act taken by the Joint Administrators pursuant to §§ 6.06 or 6.07 [of the Plan] shall in and of itself be deemed a submission to the jurisdiction of the U.S. court by any creditor with respect to whose claim the Administrators may be acting.
It is unclear if this section only refers to personal jurisdiction over a creditor, or whether it refers to submission to the bankruptcy court's equitable jurisdiction, or whether it refers to both. As each of these interpretations of the clause are reasonable, on a motion to dismiss I assume that “jurisdiction” refers to personal jurisdiction and that § 6.09 does not necessarily support the Banks's argument that they have not submitted to the Chapter 11 claims adjustment process by filing claims in England.
. MCC’s citation of 11 U.S.C. § 508(a) is also unavailing. Section 508(a) limits the ability of a creditor who receives a payment or "transfer” of property in a foreign proceeding from receiving a distribution in a Chapter 11 case. Because "transfer” in § 508(a) obviously refers to offshore transfers of property, MCC and the Examiner contend that "transfer” in § 547 should be interpreted to have the same meaning in order to give the term a consistent definition in the Code. However, § 508(a) specifically refers to a "foreign” proceeding, and is therefore illustrative of Congress' ability to express an intent to legislate with respect to conduct that occurs abroad.
. For example, a trustee may not avoid a transfer which qualifies as a preference under § 547(b) if the transfer is made in payment of a debt incurred in the ordinary course of business of the debtor and the transferee, the transfer is made in the ordinary course of business of the debtor and the transferee, and the transfer is made according to ordinary business terms. See 11 U.S.C. § 547(c)(2).
. Most courts discussmg the "effects” exception to the presumption against extraterritoriality have required that the actor intend that its conduct result in substantial effects within the U.S.
See U.S. v. Aluminum Co. of America,
. In
Hartford Fire,
Justice Scalia also identified a related, albeit different type of comity: whereby a court declines to exercise jurisdiction over a matter more appropriately decided elsewhere.
See id.,
-U.S. at-,
. This analysis is basically the same as that set out in § 403 of the Restatement (Third) of Foreign Relations Law of the United States (1987) (“Restatement (Third)”). Under the Restatement (Third), the touchstone of a choice of law analysis is "reasonableness.” The factors set out in the Restatement (Third) that a court may consider as part of a reasonableness inquiry are focused on locating the jurisdiction whose laws and policies are the most involved with the controversy.
See also Hartford
Fire,-U.S. at-,
. Barclays contends that the Examiner waived this argument by failing to raise it in the bankruptcy court. However, the Adversary Complaints all contain claims under § 502(d) and the bankruptcy court appeared to address the argument at the hearing on the Banks' motions to dismiss.
See
Transcript of Hearing, June 13, 1994 at p. 125. Even if the argument was not specifically raised and argued in the bankruptcy court, moreover, this court has the power to consider an issue presented by the record on appeal.
See In re Hilsen,
. The Examiner cites several cases holding that, even if a preferential transfer cannot be avoided due to the expiration of the statute of limitations imposed by 11 U.S.C. § 546, the transfer may still be asserted under § 502(d) to disallow a claim filed against the estate.
See, e.g., In re KF Dairies, Inc.,