In Re Ferncrest Court Partners, Ltd., Debtor. Akram Daniel v. Amci, Inc. Corson & Buckey, Inc.

MILES, District Judge,

dissenting.

Although I agree with the majority’s conclusion that the brokers were contractually entitled to a commission under the requirements of Ohio law, I must disagree with the conclusion that the bankruptcy court properly allowed payment of the commission as an administrative expense.

The majority appears to consider the March 1,1991 stipulation between the debtor in possession and Home Life to be key to this case, for in this stipulation — according to the majority — “Home Life, as first secured creditor, stipulated in writing to Debtor’s right to pursue a private sale for a limited amount of time.” If Home Life had in fact so stipulated, I would have no trouble concluding that Daniel, as successor-in-interest to Home Life, was bound by it. However, the stipulation contains no express consent to a private sale, and its rather careful wording affords little basis for inferring consent.

The March 1, 1991 stipulation recites a “Background” of the following facts: that Home Life wished to terminate AMCI as the manager of the property and hire a replacement firm to manage it; that there was no equity in the property; that the debtor in possession had no intention to reorganize; and that the debtor in possession wished to have a reasonable time in which to expose the property for sale. The pertinent terms of the actual stipulation read as follows:

1. Subject to the terms of Paragraph 2 herein, Debtor agrees that the automatic stay of § 362 may be and hereby is lifted as to Lender and that Lender may exercise all its rights and remedies with respect to the Property as permitted by any agreements or documents that pertain or relate to the Property as well as the Uniform Commercial Code and any other applicable non-bankruptcy law.
2. Pursuant to agreement between Debtor and Lender, Lender has the right to seek the appointment of a receiver for the Property. Debtor does not and will not object to the implementation of that remedy by Lender after May 1, 1991 and Lender agrees not seek [sic] to replace AMCI as manager of the Property prior to May 1, 1991 without further Order of this Court based on a change of circumstances.

Therefore, the stipulation, which the bankruptcy court approved, expressly allowed Home Life to immediately pursue its non-bankruptcy remedies — with the exception of seeking the appointment of a receiver for the property. Home Life did not agree to the retention of the brokers in consideration for the debtor in possession’s agreement to lift the automatic stay; instead, Home Life simply agreed to temporarily halt efforts to displace AMCI as the property’s manager.1

Both Home Life and Daniel sought relief from the automatic stay in order to pursue their state court remedies. Daniel’s own March 19, 1991 motion for relief from the automatic stay, which the bankruptcy court granted, recited that Home Life had already commenced foreclosure proceedings in state court. Where the creditor moves to lift the automatic stay, it is particularly inappropriate to view the creditor as having consented to the administrative expenses. Noland v. Williamson (In re Williamson), 94 B.R. 958, *784965 (Bankr.S.D.Ohio 1988); Brookfield Prod. Credit Ass’n v. Borron, 36 B.R. 445, 448 (E.D.Mo.1983), aff'd, 738 F.2d 951 (8th Cir.1984). Under the circumstances, I fail to see how either Home Life or its assignee Daniel could be deemed to have even impliedly consented to the payment of the brokers’ commission. Moreover, because the bankruptcy court made no finding that the brokers’ services were of primary benefit to Daniel, this alternative basis for charging him with the expense also fails.

Because I would reverse the allowance of the brokers’ commission as an administrative expense to be paid from the proceeds of the secured collateral, I respectfully dissent.

. Perhaps even more troubling than the bankruptcy court’s erroneous inference of consent is its failure to consider Daniel's argument that AMCI, which managed the apartment complex for the debtor in possession and which sought to share in the commission, had allowed the property to deteriorate under its care. For reasons which are unclear, the bankruptcy court considered the issue of deterioration to be irrelevant. However, in my view, both the bankruptcy court and the district court erred in failing to consider whether AMCI was responsible for any deterioration, and, if so, whether the deterioration negatively affected the value of the property.