Section 5 Relation Back of Lien Filing

• Library: Secured Transactions 2005

If a notice of lien is delivered within 30 days of the creation of the lien, perfection relates back to the date of lien creation. Section 301.600.2, RSMo Supp. 2004. Intervening creditors will be cut off by delivery of a notice of lien within the 30-day period, even if they succeed in filing their own notice before the first lender’s notice is filed. Id.

Until the fall of 2005, there was a conflict between the Bankruptcy Code and § 301.600.4 in respect to the relation-back period. 11 U.S.C. § 547(e)(2)(C) allowed only 20 days for perfecting a lien in order for perfection to relate back to the date of lien creation. In bankruptcy cases, that provision was held to trump Missouri’s 30-day relation-back period. Fid. Fin. Servs., Inc. v. Fink (In re Beasley), 522 U.S. 211 (1998). The practical effect was to allow bankruptcy trustees to avoid liens as preferential transfers if (1) they were perfected more than 20 days after they were created and (2)...