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IN RE SARGENT WALNUT RANCHES, INC.

Bankruptcy No. 97-94031-A-7, Adversary No. 97-9293.

219 B.R. 880 (1998)

In re SARGENT WALNUT RANCHES, INC., Debtor. U.S. BANK, N.A., Plaintiff, v. DESERET FARMS OF CALIFORNIA, INC., and Gary Farrar, Chapter 7 Trustee, Defendants. DESERET FARMS OF CALIFORNIA, INC., Counter-Claimant, v. U.S. BANK, N.A., and Gary Farrar, Chapter 7 Trustee, Counter-Defendants.

United States Bankruptcy Court, E.D. California, Modesto Division.

April 20, 1998.

Attorney(s) appearing for the Case

Richard A. Rogan, Jeffer, Mangels, Butler & Marmaro, L.L.P., San Francisco, for Plaintiff and Counter-Defendant U.S. Bank, N.A.

William J. Thomas, Law Offices of William J. Thomas, Sacramento, CA, for Defendant and Counter-Claimant Deseret Farms of California, Inc.

MEMORANDUM DECISION

MICHAEL S. McMANUS, Bankruptcy Judge.

This controversy requires the court to determine whether a producer's lien granted by section 55631 of the California Food & Agricultural Code encumbers not only a farm product but also proceeds from its sale. This question arises in a dispute between a bank and a walnut grower. The bank asserts a perfected security interest in an insolvent walnut processor's inventory and the proceeds from its...

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