Cite as: 530 U. S. 1 (2000)
Opinion of the Court
Robert H. Brownlee argued the cause for respondent. With him on the brief was David D. Farrell.*
Justice Scalia delivered the opinion of the Court.
In this case, we consider whether 11 U. S. C. § 506(c) allows an administrative claimant of a bankruptcy estate to seek payment of its claim from property encumbered by a secured creditor's lien.
I
This case arises out of the bankruptcy proceedings of Hen House Interstate, Inc., which at one time owned or operated several restaurants and service stations, as well as an outdoor-advertising firm. On September 5, 1991, Hen House filed a voluntary petition under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Eastern District of Missouri. As a Chapter 11 debtor-in-possession, Hen House retained possession of its assets and continued operating its business.
Respondent had been Hen House's primary lender.1 At
the time the Chapter 11 petition was filed, it held a security interest in essentially all of Hen House's real and personal property, securing an indebtedness of over $4 million. After the Chapter 11 proceedings were commenced, it agreed to lend Hen House an additional $300,000 to help finance the reorganization. The Bankruptcy Court entered a financing order approving the loan agreement and author-*Mark F. Horning, Sidney P. Levinson, Craig A. Berrington, and Phillip L. Schwartz filed a brief for the American Insurance Association et al. as amici curiae urging reversal.
Carter G. Phillips and Shalom L. Kohn filed a brief for the Commercial Finance Association as amicus curiae urging affirmance.
1 Respondent Union Planters Bank is the successor of Magna Bank, which is in turn the successor of Landmark Bank of Illinois. Hen House was originally indebted to Landmark Bank. For simplicity, we will not distinguish between the various entities.
3
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