In re Tollenaar Holsteins

MEMORANDUM DECISION GRANTING TRUSTEE’S MOTION TO SURCHARGE COLLATERAL

INTRODUCTION

Presently before the court is a Motion to Surcharge Collateral filed by Russell K. Burbank, the trustee appointed in the above-captioned jointly-administered chapter 11 cases. The trustee seeks to surcharge the collateral of secured creditors Bank of the West and Hartford Accident and Life Insurance Company under 11 U.S.C. § 506 (c) for expenses incurred in the administration of the Tollenaar Holsteins, Friendly Pastures, and T Bar M Ranch chapter 11 cases. Section 506(c) permits a trustee to surcharge a secured creditor’s collateral for the reasonable and necessary expenses incurred in preserving or disposing of collateral for the benefit of a secured creditor. 1 The surcharge initially requested was $278,794.43. That amount appears to have been revised by the trustee to $269,354.82, and is allocated $153,393.46 to Bank and $115,961.36 to Hartford.

The trustee’s surcharge motion was initially heard on August 11, 2015. Proper notice was given to all required parties and parties in interest. Appearances were noted on the record.

During the initial hearing on August 11, 2015, the court expressed…