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UNION BANK v. WOLAS Opinion of the Court

§§ 547(b), (c)(2), (f); H. R. Rep. No. 95–595, p. 178 (1977). At the same time, Congress created a new exception for transfers made in the ordinary course of business, 11 U. S. C. § 547(c)(2). This exception was intended to “leave undisturbed normal financial relations, because it does not detract from the general policy of the preference section to discourage unusual action by either the debtor or his creditors during the debtor’s slide into bankruptcy.” H. R. Rep. No. 95– 595, at 373. In light of these substantial changes in the preference provision, there is no reason to assume that the justification for narrowly confining the “current expense” exception to trade creditors before 1978 should apply to the ordinary course of business exception under the 1978 Code. Instead, the fact that Congress carefully reexamined and entirely rewrote the preference provision in 1978 supports the conclusion that the text of § 547(c)(2) as enacted reflects the deliberate choice of Congress.15 III The Bank and the trustee agree that § 547 is intended to serve two basic policies that are fairly described in the House Committee Report. The Committee explained: “A preference is a transfer that enables a creditor to receive payment of a greater percentage of his claim against the debtor than he would have received if the transfer had not been made and he had participated in 15

Indeed, the House Committee Report concludes its discussion of the trustee’s avoidance powers with the observation that the language in the preference section of the earlier Bankruptcy Act was “hopelessly complex” and had been “subject to varying interpretations. The bill undoes the numerous amendments that have been heaped on section 60 during the past 40 years, and proposes a unified and coherent section to deal with the problems created by prebankruptcy preferential transfers.” H. R. Rep. No. 95–595, p. 179 (1977). Respondent’s assumption that § 547(c)(2) was intended to preserve pre-existing law is at war with this legislative history.