               ELECTRONIC CITATION: 2010 FED App. 0011P (6th Cir.)
                            File Name: 10b0011p.06

           BANKRUPTCY APPELLATE PANEL OF THE SIXTH CIRCUIT

In re: EVONNE M. GIAIMO,                       )
                                               )
                  Debtor.                      )
_____________________________________          )
                                               )
                                               )
WILLIAM TODD DROWN, TRUSTEE,                   )
                                               )
             Appellee,                         )                      No. 10-8029
                                               )
      v.                                       )
                                               )
MAUREEN PERFECT, EXECUTOR OF                   )
THE ESTATE OF VERONICA O’KEEFE,                )
                                               )
             Appellant.                        )
                                               )

                     Appeal from the United States Bankruptcy Court
                            for the Southern District of Ohio
                        Case No. 09-56557, Adv. No. 09-02364

                          Decided and Filed: December 29, 2010

      Before: FULTON, HARRIS, and RHODES, Bankruptcy Appellate Panel Judges.

                                ____________________

                                      COUNSEL

ON BRIEF: Michael T. Gunner, Hilliard, Ohio, for Appellant. William Todd Drown, Nancy
Ashbrook Willis, FOLLAND & DROWN LPA, Mount Vernon, Ohio, for Appellee.
                                       ____________________

                                             OPINION
                                       ____________________

        ARTHUR I. HARRIS, Bankruptcy Appellate Panel Judge. In this appeal, Maureen Perfect,
Executor of the Estate of Veronica O’Keefe (“O’Keefe”) appeals the bankruptcy court’s order
granting summary judgment on the Trustee’s complaint to avoid her lien on the vehicle of chapter
7 debtor, Evonne Giaimo (“Debtor”). For the reasons that follow, we REVERSE the order of the
bankruptcy court.
                                      I. ISSUE ON APPEAL

        The issue presented by this appeal is whether an application for certificate of title to a motor
vehicle and a certificate of title, both identifying the lienholder, are sufficient under Ohio law to
create a security interest in a vehicle.

                     II. JURISDICTION AND STANDARD OF REVIEW

        The Bankruptcy Appellate Panel of the Sixth Circuit has jurisdiction to decide this appeal.
The United States District Court for the Southern District of Ohio has authorized appeals to the
Panel, and neither party has timely elected to have this appeal heard by the district court. 28 U.S.C.
§§ 158(b)(6), (c)(1). A final order of the bankruptcy court may be appealed as of right pursuant to
28 U.S.C. § 158(a)(1). For purposes of appeal, an order is final if it “ends the litigation on the merits
and leaves nothing for the court to do but execute the judgment.” Midland Asphalt Corp. v. United
States, 489 U.S. 794, 798, 109 S. Ct. 1484, 1497 (1989) (citations omitted). The bankruptcy court’s
grant of summary judgment to the Trustee is a final appealable order which we review de novo. See
Menninger v. Accredited Home Lenders (In re Morgeson), 371 B.R. 798, 800 (B.A.P. 6th Cir. 2007).
“Under a de novo standard of review, the reviewing court decides an issue independently of, and
without deference to, the trial court’s determination.” Id. (citation omitted).




                                                   2
                                                III.   FACTS

        On June 11, 2009, Evonne M. Giaimo (“Debtor”) filed a voluntary petition for relief under
chapter 7 of the Bankruptcy Code. Listed on the Debtor’s schedules of assets was a 2008 Toyota
RAV 4. The Debtor purchased the vehicle in February 2008, with an interest free loan from her
grandmother, Veronica O’Keefe (“O’Keefe”).1 The Debtor and O’Keefe did not execute any formal
loan documents.

        William Todd Drown (“Trustee”) was appointed chapter 7 trustee of the Debtor’s bankruptcy
estate. The Debtor provided the Trustee with the Application for the Certificate of Title prepared
by the dealership where the vehicle was purchased. The application contained a description of the
vehicle, identified O’Keefe as the lienholder, and was signed by the Debtor. The Debtor also
provided the Trustee with the Ohio Certificate of Title to the vehicle which also identified O’Keefe
as lienholder. At the meeting of creditors, the Debtor testified that these are the only documents
regarding O’Keefe’s lien and security interest in the vehicle. Apart from these two documents, there
is no evidence of a written security agreement between the Debtor and O’Keefe.

        On August 9, 2009, the Trustee filed an adversary complaint, pursuant to 11 U.S.C. § 544,
seeking to avoid O’Keefe’s purported security interest and lien on the ground that there was no
written security agreement between the Debtor and O’Keefe as required by Ohio law to create a valid
security interest in the vehicle. O’Keefe asserted, however, that the application and certificate of title
were sufficient. She further asserted that there is no requirement to produce a written security
agreement because, pursuant to Ohio Revised Code § 4505.13(B), once the clerk of court noted the
lien on the vehicle’s certificate of title, it was valid against all creditors of the Debtor.

        On February 22, 2010, the bankruptcy court heard argument on the Trustee’s motion for
summary judgment. Counsel for both parties agreed that the facts were not in dispute. The
bankruptcy court agreed with the Trustee that Ohio law requires a written security agreement, and
that because no such agreement was presented, the Trustee was entitled to summary judgment. On


        1
           In an agreed order dated December 8, 2009, Maureen Perfect, Executor of the Estate of Veronica O’Keefe,
was substituted for defendant, Veronica O’Keefe, who died.

                                                        3
February 25, 2010, the bankruptcy court entered a written order granting summary judgment in favor
of the Trustee.

        On March 8, 2010, O’Keefe filed a motion pursuant to Federal Rule of Bankruptcy Procedure
7052(b)(1) requesting that the bankruptcy court make findings of fact and conclusions of law on the
Trustee’s motion for summary judgment. On March 16, 2010, O’Keefe filed a motion to stay the
execution and enforcement of the order avoiding her lien including any requirement that the vehicle
be turned over. On April 19, 2010, the court issued separate orders denying each of these motions
because sufficient basis for the requested relief was not provided. On April 27, 2010, O’Keefe
timely filed a notice of appeal seeking reversal of the bankruptcy court’s order granting the Trustee’s
motion for summary judgment. See Fed. R. Bankr. P. 8002(b)(1).

                                        IV.    DISCUSSION

        Pursuant to 11 U.S.C. § 544(a)(1), a bankruptcy trustee may avoid any transfer of property
of the debtor that would be voidable by a judgment lien creditor. 11 U.S.C. § 544(a)(1). As a
hypothetical judgment lien creditor, the trustee is deemed to have perfected his interest as of the date
of the filing of the bankruptcy petition. See 11 U.S.C. § 544(a)(1); Palmer v. Washington Mut. Bank
(In re Ritchie), 416 B.R. 638, 643 (B.A.P. 6th Cir. 2009). Under § 544(a)(1), if a lien against the
debtor’s property was improperly perfected, or not perfected at all, before the bankruptcy petition
was filed, the trustee may take priority. “However, it is not even necessary to visit the issue of
perfection until it has been determined that a valid security interest exists in the vehicle in dispute.”
Yoppolo v. Trombley (In re DeVincent), 238 B.R. 722, 725 (Bankr. N.D. Ohio 1999). The issue in
this case is not whether O’Keefe properly perfected her interest in the Debtor’s vehicle on the
certificate of title, but rather whether O’Keefe has a valid security interest in the Debtor’s vehicle.

        Whether O’Keefe has a valid security interest in the Debtor’s vehicle is governed by Ohio
law. Butner v. United States, 440 U.S. 48, 54, 99 S. Ct. 914, 918 (1979) (property rights in a
debtor’s assets are determined by state law); In re Ritchie, 416 B.R. at 643. Initially, the parties to
this appeal disagree as to what Ohio law applies. The Trustee asserts that the issue is controlled by
Article 9 of the Uniform Commercial Code (“UCC”), as adopted and enacted by Ohio, while


                                                   4
O’Keefe argues that Ohio’s Certificate of Title Act, in particular Ohio Rev. Code § 4505.13,
controls.2

       “Under Ohio law, perfection of a security interest is generally accomplished through the
filing of a financing statement. However, this method of perfection is inapplicable in the case of
motor vehicles.” Rhiel v. Wells Fargo Fin. Acceptance (In re Fields), 351 B.R. 887, 890 (Bankr.
S.D. Ohio 2006) (citing Ohio Rev. Code §§ 1309.310(A) and 1309.311(A)(2)). Under Ohio’s
Certificate of Motor Vehicle Title Act, except for vehicles held as inventory, the notation of a lien
on the vehicle’s certificate of title is the exclusive manner by which a security interest is perfected
in a motor vehicle. O’Keefe asserts that how a creditor becomes a secured party under Ohio Revised
Code § 1309.203 is irrelevant as to how one becomes secured under § 4505.13(B):

                  The Clerk of Common Pleas Court alone makes the determination if
                  a security interest exists whether by production of a security
                  agreement pursuant to R.C. § 4505.13(B) or the providing of
                  evidence of a security interest via electronic means. R.C.
                  § 4505.13(C)(1). The clerk is not required nor permitted to keep


       2
           Ohio Revised Code § 4505.13 provides, in pertinent part:

                  § 4505.13. Security interests in motor vehicles, ... dealer inventory

                  (A)(1) Chapter 1309 . . . do[es] not permit or require the deposit, filing, or other
                  record of a security interest covering a motor vehicle . . .
                  (B) [A]ny security agreement covering a security interest in a motor vehicle, if a
                  notation of the agreement has been made by a clerk of court of common pleas on
                  the face of the certificate of title or the clerk has entered a notation of the agreement
                  into the automated title processing system and a physical certificate of title for the
                  motor vehicle has not been issued, is valid as against the creditors of the debtor . . .
                  and against subsequent purchasers, secured parties and other lienholders or
                  claimants. . . .

                  The secured party, upon presentation of evidence of a security interest to a clerk of
                  a court of common pleas, together with the certificate of title if a physical certificate
                  of title for the motor vehicle exists . . . may have a notation of the security interest
                  made. . . .

                  ...

                  (C)(1) In all cases, a secured party may choose to present a clerk with evidence of
                  a security interest via written confirmation through electronic means, and the clerk
                  shall enter the security interest into the automated title processing system.

                                                             5
                 copies of the security agreement or electronic notification of the
                 security interest R.C. § 4505.13(A)(1), thus once the clerk has noted
                 the lien on the title it is effective against creditors of the Debtor,
                 subsequent purchasers, secured parties, other lienholders or claimants
                 R.C. § 4505.13(B).
 (Appellant’s Br. at 6.)

        While O’Keefe is correct that Ohio Revised Code § 4505.13 governs the perfection of liens
on motor vehicles, Article 9 of the UCC continues to govern how a lien is created. In a leading
treatise often cited by the Ohio Supreme Court in decisions interpreting Ohio’s version of the UCC,3
Professors White and Summers explain the interplay between Article 9 and other state laws:

                 Even where the security interest in personalty is consensual, other
                 state law may govern. Usually this other state law will govern only
                 a relatively limited aspect of the transaction, with Article 9 remaining
                 applicable to all other aspects. The prime example is a state
                 “certificate of title” law specifying the mode of perfecting a security
                 interest in a motor vehicle. Article 9 itself contemplates the existence
                 of these title laws, and expressly gives way to them in regard to filing.
                 [see § 9-311(a)] But even though some of these laws also include
                 priority rules, those rules do not control when in conflict with Article
                 9 unless the state legislature specifically so provides.

4 White & Summers, Uniform Commercial Code, § 30-12 (6th ed. 2010) (footnotes omitted). Ohio
Rev. Code § 1309.311(A)(2) so contemplates Ohio’s Certificate of Title Act and gives way to it in
regard to filing in providing that the “filing of a financing statement is not necessary or effective to
perfect a security interest in property subject to . . . Chapters . . . 4505 . . . of the Revised Code . . . .”
Section 1309.311 goes on to provide that, except for certain situations which are not applicable here,
“duration and renewal of perfection of a security interest perfected by compliance with the
requirements prescribed by a statute, regulation, or treaty described in division (A) of this section
[such as Chapter 4505] are governed by the statute, regulation, or treaty. In other respects, the
security interest is subject to this chapter.” Ohio Rev. Code § 1309.311(C). In other words, the
Certificate of Title Act governs perfection, duration, and renewal of the security interest, but in all

        3
          For example, in Arcanum Nat’l Bank v. Hessler, 433 N.E.2d 204, 210 (Ohio 1982), the Ohio Supreme Court
described W hite and Summers as “noted authorities on the Uniform Commercial Code[.]”

                                                       6
other respects, including its creation, the security interest is governed by Article 9. See In re Fields,
351 B.R. at 891 (Ohio’s version of UCC Article 9 continued to govern assignment of security
interest in motor vehicle perfected under Ohio’s Certificate of Title Act); see also Noland v. HSBC
Auto Fin., Inc. (In re Baine), 393 B.R. 561, 566 (Bankr. S.D. Ohio 2008) (creditor that failed to note
lien on vehicle’s certificate of title had valid security interest under O.R.C. § 1309.203; however,
security interest was unperfected under O.R.C. 4505.13(B)).

         As one court has explained:

                   Secured transactions in motor vehicles are governed by the same
                   principles as govern secured transactions in other types of collateral
                   insofar as the creation and effect of a secured transaction therein is
                   concerned. The fact that title certificate notation is required in most
                   states to perfect a security interest in a motor vehicle in the hands of
                   the ultimate user has no effect upon the creation of a security interest
                   in a motor vehicle.
Bradley v. K&E Invs., Inc., 847 S.W.2d 915, 921 (Mo. Ct. App. 1993) (citing 8 Anderson on the
Uniform Commercial Code § 9-203:8 at 664 (3d ed. 1985)); see also Wyatt v. Nowlin (In re Wyatt),
338 B.R. 76, 80 (Bankr. W.D. Mo. 2006) (while certificate of title statute specifies manner in which
lien is perfected, Article 9 continues to govern how lien is created); Owen v. Lundstrom (In re
Owen), 349 B.R. 66, 69 (Bankr. D. Idaho 2006) (Idaho’s version of Article 9 governs attachment of
security interest in vehicle, while Idaho Vehicle Titles Act governs its perfection). Therefore,
contrary to O’Keefe’s assertions, Article 9 of the UCC, as adopted and enacted by Ohio, governs her
claim to a security interest in the Debtor’s vehicle.4



         4
            In further support of her position that Article 9 of the UCC is inapplicable here, O’Keefe cites to Saturn of
Kings Automall, Inc. v. Mike Albert Leasing, Inc., 751 N.E.2d 1019 (Ohio 2001). O’Keefe’s reliance on Saturn of Kings
is misguided. There, the Ohio Supreme Court was faced with competing claims of ownership in several vehicles where
the certificates of title had not been transferred. The issue was “whether a person may acquire legal ownership of a motor
vehicle without transfer to that person of the vehicle’s certificate of title.” Id. at 1021. In resolving the issue, the court
considered the interplay between Ohio’s adoption of Article 2 of the UCC and Ohio’s Motor Vehicle Title Law. The
court held that in determining competing claims of ownership of a motor vehicle, Ohio Revised Code § 4505.04(A)
controls over the provisions of the UCC. Id. at 1025. Article 2 of the UCC is not at issue here, nor are competing claims
of ownership in the vehicle. At issue here is the validity of a lien and Article 9 of the UCC. Moreover, Article 9 of the
UCC and Ohio’s Motor Vehicle Title Law are not in conflict. As explained above, Article 9 governs the creation of the
lien, while the certificate of title law governs the perfection of the lien.

                                                              7
        UCC Article 9, governed by Ohio Revised Code §§ 1309.101-1309.709, “applies to . . . [a]
transaction, regardless of its form, that creates a security interest in personal property . . . .” Ohio
Rev. Code § 1309.109(A)(1).           A “security interest” is defined in Ohio Revised Code
§1301.01(KK)(1) as “an interest in personal property or fixtures that secures payment or performance
of an obligation.” At the center of Ohio Revised Code Chapter 1309 is § 1309.203 which sets forth
the attachment and enforceability of a secured interest and the formal requisites. See Silver Creek
Supply v. Powell, 521 N.E.2d 828, 831 (Ohio Ct. App. 1987). Ohio Revised Code § 1309.203
provides:

                (A) A security interest attaches to collateral when it becomes
                enforceable against the debtor with respect to the collateral, unless an
                agreement expressly postpones the time of attachment.
                (B) Except as otherwise provided in divisions (C) to (I) of this
                section, a security interest is enforceable against the debtor and third
                parties with respect to the collateral only if:
                (1) Value has been given;
                (2) The debtor has rights in the collateral or the power to transfer
                rights in the collateral to a secured party; and
                (3) One of the following conditions is met:
                        (a) The debtor has authenticated a security agreement that
                        provides a description of the collateral . . . .


        The Trustee does not dispute that value was given and that the Debtor had rights in the
vehicle, thereby satisfying the first two requirements of Ohio Revised Code § 1309.203. Therefore,
the only issue for our review is whether the application for certificate of title and the certificate of
title itself, both noting O’Keefe as lienholder, are sufficient to meet the “security agreement”
requirement of Ohio Revised Code § 1309.203.

        The term “security agreement” is defined as “an agreement that creates or provides for a
security interest.” Ohio Rev. Code § 1309.102(A)(73). It has been well established that while no
specific words or formalized documents are necessarily required to create a security interest, there
must be some written documentation that indicates the parties’ intent to create a security interest.


                                                   8
See Silver Creek, 521 N.E.2d at 832; Steego Auto Parts Corp. v. Markey, 441 N.E.2d 279, 282 (Ohio
Ct. App. 1981).

                 It thus appears that no special form of words is required to give rise
                 to a security interest. It is, however, necessary that an intent to grant
                 or to create a security interest be manifested. It would be sufficient
                 if the parties use language which leads to the conclusion that it was
                 the intention of the parties that a security interest be created.
Id. (internal quotations omitted). In their treatise on the UCC, Professors White and Summers
comment on how easily a secured party can create an enforceable Article 9 security interest under
Section 9-203:

                 Consider how little suffices to bind the debtor. For example, it is
                 enough for the debtor to write on the back of an envelope, ‘I hereby
                 grant bank a security interest in my cattle, John Jones.’ If the bank
                 makes a loan and the debtor owns the cattle, the parties created a
                 valid security interest despite its informality.
4 White & Summers, Uniform Commercial Code, § 31-2 (6th ed. 2010) (footnote omitted). White
and Summers further note:

                 [UCC §] 9-203 does not require more [than a showing that parties
                 intended a security interest] for as [Official] comment 3 [to 9-203]
                 states, the writing requirement is a formal requisite ‘in the nature of
                 a statute of frauds.’ A statute of frauds requirement on the model of
                 2-201 merely contemplates objective indicia of the possibility of an
                 underlying actual agreement - here an agreement for security.
Id. at § 31-3.

        Chapter 1309 of the Ohio Revised Code “shall be liberally construed and applied to promote
[its] underlying purposes and policies.” Ohio Rev. Code § 1301.02(A). Some of those underlying
purposes and policies are to “simplify, clarify, and modernize the law governing commercial
transactions,” and to “permit the continued expansion of commercial practices through custom,
usage, and agreement of the parties[.]” Ohio Rev. Code § 1301.02(B)(1) and (2). This liberal
approach of the UCC to commercial law was recognized by the Third District Court of Appeals of
Ohio in Silver Creek, 521 N.E.2d at 833. Additionally, the Silver Creek court noted that Ohio


                                                    9
Revised Code § 1309.1095 “implies that security interests should be recognized whenever the parties
so intend.” Id.

        Rather than requiring one single document evidencing this intent, courts typically “review
all the documents between the parties to determine whether a sufficient written foundation has been
established for the creation of a security interest.” Silver Creek, 521 N.E.2d at 832 (emphasis in
original). This approach, often referred to as the “composite documents approach,” “examines all
the documents executed between a debtor and a creditor to determine, if taken together, whether the
‘writing or writings, regardless of label, . . . adequately describes the collateral, carries the signature
of the debtor, and establishes that in fact a security interest was agreed upon . . . .’” Belfance v.
Buonpane (In re Omega Door Co., Inc.), 399 B.R. 295, 306 (B.A.P. 6th Cir. 2009) (quoting In re
Numeric Corp., 485 F.2d 1328, 1331 (1st Cir. 1973)). Official Comment 3 to Ohio Revised Code
§ 1309.203 explains that the requirement of a writing is “in the nature of a Statute of Frauds.”

        We are unaware of any Ohio court decisions addressing whether an application for certificate
of title and certificate of title, in particular, are sufficient to create a security interest under Ohio
Revised Code § 1309.203. Thus, we must interpret the governing state law, and predict what the
highest court of Ohio would decide, from “all relevant data” including “state appellate decisions, . . .
state supreme court dicta, restatements of law, law review commentaries, and the majority rule
among other states.” See Lebovitz v. Hagemeyer (In re Lebovitz), 360 B.R. 612, 621 (B.A.P. 6th Cir.
2007) (quoting Garden City Osteopathic Hosp. v. HBE Corp., 55 F.3d 1126, 1130 (6th Cir. 1995)).

        In trying to predict whether the highest court of Ohio would deem the application for
certificate of title and certificate of title in the present case as sufficient to create a security interest



        5
            Ohio Rev. Code § 1309.109 provides:

                  (A) Except as otherwise provided in divisions (C) and (D) of this section, this
                  chapter applies to the following:

                  (1) A transaction, regardless of its form, that creates a security interest in personal
                  property . . . .

(At the time Silver Creek was decided this language was found in § 1309.02.)

                                                           10
under Ohio Revised Code § 1309.203, perhaps the most instructive Ohio appellate court decision
is the 1987 decision of the Ohio Court of Appeals in Silver Creek. In Silver Creek, the only
document available that purported to establish a security agreement was a standardized financing
statement. The court concluded that while some financing statements may contain language
sufficient to evidence an agreement, 521 N.E.2d at 833-34, “the financing statement herein fails to
adequately evidence that the parties manifested, in writing, an intent to create a security interest.”
Id. at 834. In doing so, the court distinguished the facts of the case before it from those in other
cases where a security interest was created, including In re McCormick, where an application for a
certificate of title and issuance of the certificate satisfied the requirement for a security agreement
under Michigan’s version of UCC 9-203. See Silver Creek, 521 N.E.2d at 833 (distinguishing
Winshall v. McCormick (In re McCormick), 24 B.R. 718 (Bankr. E.D. Mich. 1982)).

         Another instructive decision is the bankruptcy court’s decision in Yoppolo v. Trombley (In
re DeVincent), 238 B.R. 722 (Bankr. N.D. Ohio 1999). In DeVincent, the debtor owned a vehicle
financed by her sister. The debtor and her sister both signed a promissory note, and the debtor’s
sister was identified as the lienholder on the certificate of title. The promissory note simply
identified the parties, the vehicle, the total purchase price, and the monthly payments to be made, but
said nothing about a security interest in the vehicle. When the debtor filed for chapter 7 relief, the
trustee sought to avoid the sister’s security interest and lien on the grounds that the promissory note
lacked the necessary language to create a security interest in the vehicle. The debtor’s sister asserted
that her lien was perfected by virtue of the promissory note and the lien noted on the certificate of
title.

         The court looked to Article 9 of the UCC, as enacted by Ohio in chapter 1309, to determine
whether the sister had a valid security interest in the vehicle. In re DeVincent, 238 B.R. at 725-26.
Like the case at hand, the only element of Ohio Revised Code § 1309.2036 at issue was whether there
was a valid security agreement. Id. at 725. The debtor’s sister argued that the promissory note in
conjunction with the notation on the certificate of title that listed her as a lienholder demonstrated


         6
          At the time DeVincent was decided O.R.C. § 1309.203 was found at O.R.C. § 1309.14. Section 1309.14 was
repealed on July 1, 2001, and revised and reenacted as § 1309.203.

                                                      11
the necessary intent to create a security interest under the “composite documents” approach. Id. at
726. In rejecting the defendant’s argument, the court explained that because neither a financing
statement, the equivalent of a vehicle’s certificate of title, alone, nor a promissory note alone, exhibit
the requisite intent to create a security interest, it could not find that the two documents standing
together, under the circumstances of the case, demonstrated that the debtor and the defendant
intended to create a security interest in the vehicle at issue. Id. at 726-27.

         In this case, however, in keeping with the liberal policies of the UCC, we hold, and we
believe the Ohio Supreme Court would similarly hold, that the application for certificate of title, a
document which was not presented in DeVincent,7 and the certificate of title itself, taken together,
constitute a security agreement within the meaning of Ohio Revised Code § 1309.203. While we
are aware that other courts have come to the opposite conclusion, we are also in the company of
many courts which have reached the same conclusion. See e.g., Hall v. Hopkins (In re Jacobs), No.
04-42387, 2006 WL 4451566, at *4 (Bankr. D. Idaho Feb. 10, 2006) (finding signed application for
certificate of title and certificate of title noting lienholder sufficient to create security interest under
Idaho Code § 28-9-203); Roan v. Murray, 556 N.W.2d 893, 895 (Mich. Ct. App. 1996) (holding that
application for certificate of title signed by debtor and noting lienholder constitutes security
agreement); Simplot v. William C. Owens, M.D., P.A., 805 P.2d 449, 452 (Idaho 1990) (holding
notation in promissory notes that bus was security together with endorsement and delivery of
certificate of title constituted security agreement); Bay State Drywall, Inc. v. Chicopee Sav. Bank,
429 N.E.2d 1138, 1142 (Mass. 1982) (application for transfer of title which lists lienholder meets
writing requirement for security interest to attach); In re McCormick, 24 B.R. at 720 (application for
certificate of title and certificate of title that both listed secured creditor satisfied security agreement
requirement); Kreiger v. Hartig, 527 P.2d 483, 486 (Wash. Ct. App. 1974) (finding application for
transfer of title signed by debtor sufficient to create security interest); Clark v. Vaughn, 504 S.W.2d
550, 553 (Tex. Civ. App. 1973) (holding debtor signed certificate of title sufficient to constitute a



         7
           To the extent that our holding in this case cannot be distinguished from the holding in DeVincent based on
the factual difference between the two cases, we respectfully disagree with that portion of the court’s analysis in
DeVincent.

                                                         12
security agreement).8 Wray v. Estate of Wray, No. 9820, 1996 WL 268382 (Tenn. Ct. App. May 22,
1996) (application for certificate of title noting vehicle lien and bill of sale sufficient to give
lienholder a security interest in vehicle under Tennessee version of UCC 9-203).

         In the present case, the application for a certificate of title is a writing signed by the Debtor
and sworn to and subscribed in the presence of a notary. The application specifically identifies the
collateral, the Toyota RAV 4 with its vehicle identification number, and instructs the State of Ohio
to issue a title showing O’Keefe as lienholder. The application includes the following printed
language regarding liens on the motor vehicle:

                   The following is a full statement of all liens on said motor vehicle.
                   If no lien, state “none”. If more than one lien, attach statement of all
                   additional liens.
In handwriting following the words “Lienholder” and “Address” are: “VERONICA OKEEFE” and
“21626 N. 156 DR. Sun City W AZ 85375” respectively. Unlike simple financing statements, which
are often filed in anticipation of a possible loan and security agreement, an application for a
certificate of title is not completed unless there is an actual purchase or transfer of a motor vehicle.
When the Debtor signed the application for certificate of title, the form required her to list “a full
statement of all liens on said motor vehicle.” We can fathom no reason why the Debtor would have
signed the application for certificate of title identifying O’Keefe as the lienholder if she did not
intend to grant a security interest to O’Keefe in the vehicle. Also distinguishing the facts in the
present case from the simple financing statement in Silver Creek is the requirement that the
application for certificate of title be sworn to and subscribed in the presence of a notary. Ohio Rev.
Code § 4505.06. This requirement also helps ensure that false liens are not placed on a certificate
of title. Moreover, in situations where the placement of such a lien was done with an intent to



         8
             But see Shelton v. Erwin (In re Shelton), 472 F.2d 1118, 1120 (8th Cir. 1973) (holding bill of sale and
application for certificate of title identifying lienholder insufficient under Missouri’s adoption of Article 9 of the UCC
to create a security interest); In re Wyatt, 338 B.R. at 82 (finding handwritten contract identifying mobile home, purchase
price and terms of payment together with certificate of title noting lienholder were insufficient to create security interest
in mobile home); Cole v. Miller (In re Miller), 320 B.R. 911, 915-16 (Bankr. E.D. Mo. 2005) (no security interest created
in vehicle where only documents were application for title and certificate of title); White v. Household Fin. Corp., 302
N.E.2d 828, 837 (Ind. Ct. App. 1973) (promissory note and certificate of title insufficient to create security interest).

                                                            13
hinder, delay, or defraud or for less than a reasonably equivalent value, a bankruptcy trustee would
still have the power to avoid such a transfer under 11 U.S.C. § 548.

        We therefore hold that the Debtor’s application for certificate of title and certificate of title
indicate that the parties intended to create a security interest and that the written application for
certificate of title constitutes a security agreement within the meaning of Ohio Rev. Code
§ 1309.203. To find otherwise would place undue emphasis on formalism and be contrary to the
general principle that the UCC be “liberally construed and applied to promote [its] underlying
purposes and policies[,]” including simplification and modernization of” the law governing
commercial transactions.” Ohio Rev. Code § 1301.02(A) and (B)(1).

        Although O’Keefe did not file a cross-motion for summary judgment, the panel sees no
reason to require O’Keefe to file such a motion before the bankruptcy court following remand, given
the particular circumstances of this case. The dispositive issue has been fully briefed, and counsel
for both parties conceded in oral argument before the bankruptcy court that the facts were not in
dispute.9 See K.E. Resources, Ltd. v. BMO Fin., Inc. (In re Century Offshore Mgmt. Corp.), 119 F.3d
409, 412 (6th Cir. 1997) (affirming decision of bankruptcy court which entered summary judgment
in favor of nonmoving party after parties fully briefed the determinative issue and conceded that no
facts were in dispute). Moreover, just as the Sixth Circuit noted in analyzing the lien priority in
Century Offshore Management, “It seems reasonable to expect the [nonmoving party] to recognize
that if [its] claim is not superior to [the moving party’s claim], it is inferior.” Id.

                                             V. CONCLUSION

        For the foregoing reasons, the order of the bankruptcy court granting summary judgment in
favor of the Trustee is REVERSED, and the bankruptcy court is directed to enter judgment in favor
of O’Keefe on the Trustee’s adversary complaint.




        9
            Transcript regarding Feb. 22, 2010, hearing re: Summary Judgment at 4, 7-8 (May 12, 2010) (Docket #43).

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