Commercial Sec. Bank v. Contractors Realty & Dev., Inc. (In re Contractors Realty & Dev., Inc.)
UNPUBLISHED
Secured creditor obtained chapter 7 trustee's and debtor's agreement to relief from stay to foreclose its lien, then prepared an order indicating that trustee would be divested of any interest in the property, even though there had been no abandonment. Trustee objected, and the court held that nothing in the Bankruptcy Code allowed property to be removed from the estate in the manner proposed, and that trustee had sound reasons to object. Some of the interests retained by the estate are redemption rights, the right to purchase the property at the foreclosure sale, the right to recover surplus proceeds, and the right to object to the manner in which the property sale is conducted. In this case, the trustee had indicated an intent to abandon the property, but the time for filing objections to abandonment had not yet run. Until abandonment, an owner's rights are vested in the trustee on behalf of the estate. After abandonment, those rights would automatically return to debtor.