Barnhill v. Johnson

Summary

The Supreme Court held that, for purposes of the 90-day preference period in 11 U.S.C. § 547(b), a transfer made by ordinary check occurs on the date the drawee bank honors the check, not on the date the check is delivered. Because the debtor's check was honored on November 20, the undisputed 90th day before the Chapter 11 filing, the trustee presumptively could avoid the payment as a preferential transfer. The Court rejected the petitioner's arguments that delivery effected a 'conditional transfer' under § 101(54) and that legislative history confined by its own terms to § 547(c) required a date-of-delivery rule. Justice Stevens, dissenting, joined by Justice Blackmun, would have held that a transfer by check occurs on the date of delivery provided the check is honored within ten days, and would have reversed.