In re Millette
United States Court of Appeals for the Fifth Circuit
186 F.3d 638 (1999)
The Millettes owned a commercial building subject to a deed of trust that assigned rents to Security National and was properly recorded. O'Neal Steel (O'Neal) later obtained a judgment against the Millettes and filed a garnishment action to reach the building's rental income. Security National then began foreclosure on the building. Thomas Millette's bankruptcy filing stayed both proceedings. The bankruptcy court and district court ruled Security National's interest in the rents was superior to O'Neal's, and O'Neal appealed, arguing Security National needed to take additional steps beyond recording to perfect its interest.
Whether the interest of a mortgagee that has obtained an assignment of rents is perfected when the assignment is recorded.