Farmers State Bank of Trimont, Appellant,

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2018).

STATE OF MINNESOTA
IN COURT OF APPEALS
A19-0707

Farmers State Bank of Trimont,
Appellant,

vs.

Joel S. Rabbe,
Respondent,

Kristen C. Rabbe,
Respondent,

Jon E. Rabbe,
Respondent,

Debra A. Rabbe,
Respondent,

Joyce L. Rabbe,
Individually and as Trustee of the Residual Trust
Created Pursuant to Article VII of the
Last Will and Testament of John J. Rabbe
of August 13, 2007,
Respondent,

and

Rabbe Farms, LLP,
Defendant,

Rabbe Ag Enterprises,
LLC, f/k/a Rabbe Ag Enterprises,
Defendant,

John Doe, et al.
Defendants.

2

Filed December 30, 2019
Affirmed in part, reversed in part, and remanded
Cochran, Judge

Martin County District Court
File No. 46-CV-18-74

Dean M. Zimmerli, Dustan J. Cross, Gislas on & Hunter LLP, New Ulm, Minnesota (for
appellant)

Joel S. Rabbe, Trimont, Minnesota (pro se respondent)

Kristen C. Rabbe, Trimont, Minnesota (pro se respondent)

Jon E. Rabbe, Trimont, Minnesota (pro se respondent)

Debra A. Rabbe, Trimont, Minnesota (pro se respondent)

Joyce L. Rabbe, Trimont, Minnesota (pro se respondent)

Considered and decided by Bjorkman, Presiding Judge; Cochran, Judge; and
Smith, John, Judge.

U N P U B L I S H E D O P I N I O N
COCHRAN, Judge
Appellant-bank challenges the district court’s grant of summary judgment in favor
of respondents-debtors. Appellant argues that the district court e rred by (1) determining
that appellant’s termination of farmland leases was ineffe ctive; and (2) interpreting
respondents’ bankruptcy plan to deduct, fro m the amount owed to appellant, the total

 Retired judge of the Minnesota Court of A ppeals, serving by appoi ntment pursuant to
Minn. Const. art. VI, § 10.

3
amount of the debt owed to a senior creditor rather than only the appraised value of the
creditor’s relevant collateral. We affirm in part, reverse in part, and remand.
FACTS
The facts of this case are undisputed. Respondents are Joel Rabbe, Kristen Rabbe,
Jon Rabbe, Debra Rabbe, and Joyce Rabbe (R abbe Individuals), as well as Rabbe
Farms, LLP (Rabbe Farms) and Rabbe Ag En terprises, LLC (Rabbe Ag), two farming
companies owned by certain me mbers of the Rabbe family. 1 In 2013 and 2014, Rabbe
Farms entered into two promi ssory notes in favor of appellant Farmers State Bank of
Trimont (FSB) totaling approximately $17 million. And in 2015, Rabbe Ag entered into a
promissory note with FSB with a principal amount of $500,000. These loans were secured
by (1) a security interest “in essentially all items of personal property of Rabbe Ag,
including all of Rabbe Ag’s machinery and e quipment”; (2) a mortgage in the amount of
$2 million ($2 million mortgage), which granted FSB a mortga ge lien in 503 acres of
farmland owned by Rabbe Farms (Rabbe Farm s Farmland); and (3) a mortgage in the
amount of $15 million ($15 m illion mortgage), which granted FSB a mortgage lien in,
among other things, 1,282 acres of farmla nd owned by the Rabbe Individuals (Rabbe
Individual Farmland).
In June 2014, Rabbe defau lted on the loans. FSB th en commenced a foreclosure
action against the Rabbe Individuals, seeking to foreclose the $15 million mortgage against
the Rabbe Individual Farmland. A judgment and decree of foreclosure was entered in

1 Respondents are hereinafter collectively referred to as “Rabbe.”

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March 2016, and FSB was the high bidder on the Rabbe Individual Farmland at a
subsequent sheriff’s sale. Th e district court later confirmed the foreclosure sale of the
Rabbe Individual Farmland in July 2016, and FSB became the fee owner of this farmland
after none of the Rabbe Individuals timely redeemed.
In the meantime, in September 2015, Rabbe Farms and Rabbe Ag filed for
chapter 11 bankruptcy protection. Rabbe, FSB, and other creditors subsequently engaged
in mediation, and on July 8, 2016, the parties reached a settlement. The settlement, which
was approved by the Bankru ptcy Court on October 31, 2016, was to be primarily
implemented through two reorganization plans, one for Rabbe Ag (Rabbe Ag Plan) and
one for Rabbe Farms (Rabbe Farms Plan).
The Rabbe Ag Plan was confirmed by the Bankruptcy Court in April 2017. This
plan related to security interests in farm equipment held by Rabbe Ag’s creditors, which
included FSB. FSB’s security interest in this equipment was senior to the security interests
held by other creditors, except with respect to a John Deer e 9530T Track Tractor and a
Caterpillar 320DL excavator. John Deere Credit (John Deere) had a first priority security
interest in the tractor, securing a claim in the amount of $211,054.59, and AgDirect had a
first priority security interest in the excavator, securing a claim in the amount of
$53,887.36. FSB had a second priority secu rity interest in both the tractor and the
excavator.
The Rabbe Ag Plan allowed Rabbe to choose between one of two options to satisfy
FSB’s allowed secured claims. Rabbe Ag could either (1) auction the equipment in which
FSB had a security interest and pay FSB a po rtion of auction proceeds less certain other

5
amounts (auction option), or (2) retain th e equipment and pay FSB a portion of the
appraised value of the equipment less certain other amounts (buyout option).
Rabbe Ag elected the buyout option. As part of the buyout process, Gehling Auction
Co. inspected the Rabbe Ag equipment, a nd issued a written appraisal valuing the
equipment at $914,750. The appraisal included the John Deere tractor, which was
appraised at a value of $120,000. Following a supplemental appraisal, as well as the
addition of several items of equipment, the total value of the appraised equipment increased
to $922,750.
The parties could not agree on the amount of the payment required to complete the
buyout option. The dispute involved the valu e of John Deere’s “sen ior security interest”
in the tractor under the terms of the buyout option of the Rabbe Ag Plan. FSB claimed that
the value of John Deere’s “s enior security interest” in the tractor was $120,000, the
appraised value of the tractor. Conversely, Rabbe claimed that the value of John Deere’s
“senior security interest” in the tractor was $211,054.59, the full amount of John Deere’s
allowed secured claim arising from the debt that Rabbe Ag owed John Deere.
In addition to the Rabbe Ag Plan, the Rabbe Farms Plan was also confirmed by the
Bankruptcy Court in April 2017. Pursuant to the terms of the Rabbe Farms Plan, the Rabbe
Farms Farmland was conveyed to FSB via quitclaim deeds, making FSB fee owner of both
the Rabbe Farms Farmland and the Rabbe Indi vidual Farmland. The Rabbe Farms Plan
also required FSB to lease the Rabbe Individual Farmland and the Rabbe Farms Farmland
to Rabbe Ag for the 2017 and 2018 crop years at $185 per tillable acre.

6
FSB entered into separate leases with Rabbe Ag for e ach farmland. The leases
contained identical terms and required that re nt be remitted in equa l installments on or
before November 1 of each year. The leases also provided that if Rabbe Ag failed to make
the rent payments when due, FSB could “re-enter and take possession of the above rented
premises, and hold and enjoy the same without forfeiting the rents to be paid by [Rabbe
Ag] for the full term of [the] lease.”
Rabbe Ag failed to make any payment on the leases by the November 1, 2017
deadline. FSB subsequently sought to terminate the leases by recording Notices of Lease
Termination in the county recorder’s office on November 13, 2017. Each notice stated that
FSB “hereby provide[s] to Rabbe Ag . . . notice of termination” for failure to tender rent
payment by November 1, 2017. Each notice also stated that “[p]ursuant to the terms of the
Lease, [FSB] has elected to re-enter and take possession of the leased premises.”
FSB never served the Notices of Lease Termination on Rabbe Ag, and Rabbe Ag
was not otherwise notified of the termination of the leases. On Nove mber 14, 2017, Joel
Rabbe went to FSB and paid the first rent installment for each of the leases. FSB’s
president personally accepted the payments on be half of FSB. Neither FSB’s president,
nor anyone else from FSB, informed Joel Rabbe or any of the other Rabbe Individuals that
FSB had recorded notices of termination the day before.
On December 29, 2017, FSB commenced this action against Rabbe seeking a
declaratory judgment that the leases betwee n FSB and Rabbe Ag were terminated due to
Rabbe Ag’s default. FSB also sought a judgment for breach of contract, breach of the
covenant of good faith and fair dealing, and claim and delivery of the Rabbe Ag equipment,

7
related to Rabbe’s alleged breach of the Rabbe Ag Plan. Rabbe subsequently moved to
dismiss the complaint. On March 29, 2018, the district court denied Rabbe’s motion with
respect to the counts related to the lease agreements, but granted the motion to dismiss the
three claims related to the alleged breach of the Rabbe Ag Plan on the grounds that the
claims were subject to mandatory farmer-lende r mediation. The district court dismissed
these claims without prejudice.
In August 2018, after the parties failed to reach an agreement in the mandatory
farmer-lender mediation, FSB moved to amend the complaint to reassert the
previously-dismissed claims rela ted to the satisfaction of FSB’ s security interests. The
district court permitted the amendment. FSB then moved for summary judgment, seeking
(1) a judgment declaring that the leases be tween the parties terminated following Rabbe
Ag’s failure to tender the 2017 rent payments on November 1, 2017; and (2) either delivery
of the Rabbe Ag equipment, or payment of $205,037.01 to FSB, which represented the
amount FSB claimed Rabbe owed under the buyout option of the Rabbe Ag Plan. Rabbe
filed a cross-motion for summary judgment, s eeking a judgment declaring that the leases
were not terminated. Rabbe also claimed that FSB was required to accept $102,193.78 for
the equipment under the buyou t option. The difference in the two proposed buyout
amounts relates primarily to the different amo unts that the parties assign to the deduction
for John Deere’s security interest in the tractor.
The district court determined that FSB failed to terminate the leases because
(1) “Minnesota’s landlord-tenant law indicates that notice to a tenant is a prerequisite to an
action seeking repossession of the premises,” but Rabbe was “never provided with notice

8
of the lease termination”; and (2) FSB “accepted the late rent and thereby waived its right
to recover possession.” The district court also determined that “John Deere Credit’s ‘senior
security interests’ in the tr actor was intended to reflect th e value of its allowed secured
claim rather than the appraised value of the tractor.” The district court then concluded that
under the terms of the Rabbe Ag Plan, FSB “is to release its security interest in the Rabbe
Ag equipment in exchange for payment of $104,690.55.” 2 The district court, therefore,
granted Rabbe’s motion for summary judgment , and denied FSB’s mo tion for the same.
This appeal follows.
D E C I S I O N
Summary judgment is proper when there is no genuine issue as to any material fact
and the moving party is entitled to judgment as a matter of law. Minn. R. Civ. P. 56.01.
We review a “grant of summary judgment de novo to determine whether there are genuine
issues of material fact and wh ether the district court erred in its application of the law.”
Montemayor v. Sebright Prods., Inc. , 898 N.W.2d 623, 628 (Minn. 2017) (quotation
omitted). Summary judgment ma y be affirmed if it can be sustained on any grounds.
Doe v. Archdiocese of St. Paul, 817 N.W.2d 150, 163 (Minn. 2012).

2 Notably, the district court set the amount of the buyout at $104,690.55, which differed
from the $102,193.78 amount argued by Rabbe. Although Rabbe notes that the “disparity
results” from Rabbe’s use of a “slightly different” amount for John Deere’s secured claim
than the amount used by the district court, Rabbe has “adopt[ed] the amount as calculated
by the district court” for purposes of this appeal.

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I. Termination of the Farmland Leases
FSB challenges the district court’s denial of its request for a declaration that its
leases with Rabbe Ag have be en terminated, arguing that th e district court erred when it
determined that (1) no “eviction” was either effectuated or permitted due to lack of notice
to Rabbe; and (2) FSB waived its right to recover possession of the farmland by accepting
the late rent. We address FSB’s waiver argument first.
A landlord’s acceptance of a rent paymen t, after giving notice to quit, may show
waiver of that notice. Pappas v. Stark, 142 N.W. 1046, 1047 (Minn. 1913). In other words,
“[a]cceptance of rent operates as an election by the lessor to continue the lease.” Priordale
Mall Inv’rs. v. Farrington, 411 N.W.2d 582, 584 (Minn. App. 1987). This is because “the
landlord, by accepting the rent, effectively reaffirms the lease between parties.” Oak Glen
of Edina v. Brewington, 642 N.W.2d 481, 486 (Minn. App. 2002). But an exception to the
general rule applies when the lease contains a clause expressly stating that acceptance of
rent does not constitute a waiver of the existing or any preceding breach. Priordale Mall,
411 N.W.2d at 585. And the waiver rule does not apply if the violat ed lease provision is
part of consideration for the lease. Central Union Trust Co. of New York v. Blank ,
210 N.W. 34, 36 (Minn. 1926).
Here, it is undisputed that Rabbe paid the November 2017 rent two weeks after it
was due, and that FSB’s president accepted payment of this rent. Based on these facts, the
district court found that FSB “waived its right to recover the possession,” and that “neither”
exception to the waiver rule applied. The district court concluded that “given the rights

10
afforded” Rabbe under Minn. Stat. § 504B.2 91, subd. 1(a) (2018), it is “immaterial”
whether FSB “intended to waive the notices of termination.”
FSB contends that the district court’s re liance on section 504B.291, subdivision 1(a)
is erroneous because that statute “applies onl y to an eviction action, not a declaratory
judgment action such as this.” We agree. Minn. Stat. § 504B.291, subd. 1(a) provides that
in an eviction action for nonpayment of rent , a tenant may, subject to exceptions not
applicable here, redeem the premises and be restored to possession if the tenant pays “rent
that is in arrears, with interest, costs of the action, and an attorney’s fee not to exceed $5.”
FSB’s complaint did not seek eviction. Rather, it sought a declaration that the leases have
“been terminated” and that Rabbe has no ri ghts under the leases. Because § 504B.291,
subd. 1(a) applies only to eviction actions, th e district court erred by applying Minn.
Stat. § 504B.291 to this case.
FSB argues that because section 504B.29 1 does not apply, the district court
erroneously determined that it was immaterial whether FSB intended to waive the notices
of termination. FSB further argues that its acceptance of the “2017 late rent did not indicate
an intent to waive the Rabbes ’ breach of the lease [because ] executing and recording the
notices of lease termination demonstrated the opposite.” Thus, FSB argues that, based on
the undisputed facts, the district court erre d by concluding that FSB’s acceptance of late
rent waived its right to recover possession and terminate the leases.
The “acceptance of rent alone [does] not c onstitute waiver absent a showing of some
intent on the part of a landlord.” Priordale Mall, 411 N.W.2d at 585. As a result, the
district court erred by concludi ng that FSB’s intent was “immaterial” when deciding the

11
waiver issue. But the parties agree that the facts are undisputed. When the facts are not in
dispute, the question of waiver may be reviewed de novo as a matter of law. Montgomery
Ward & Co. v. County of Hennepin , 450 N.W.2d 299, 304 (Minn. 1990); see also
Westminster Corp. v. Anderson , 536 N.W.2d 340, 341 (Minn. App. 1995) (reviewing de
novo whether acceptance of housing assistance payments constituted waiver of landlord’s
right to terminate lease), review denied (Minn. Oct. 27, 1995).
As explained below, we conclude that the undisputed facts demonstrate that FSB
intended to waive its right to terminate the leases when it accepted late payment of the rent.
Under the terms of both leases, rent was due on November 1, 2017. The leases also state
that if Rabbe Ag failed to make the rent payments when due, FSB could “re-enter and take
possession of the above rented premises, a nd hold and enjoy the same without forfeiting
the rents to be paid by [Rabbe Ag] for the full term of [the] lease.” But the leases fail to
include a termination clause, or otherwise specify how the leases could be terminated.
In addition to the terms of the leases, the undisputed facts demonstrate that on
November 13, 2017, Joel Rabbe contacted FSB and informed an employee that he wanted
to hand deliver the full amount of the rent. An FSB employee told Joel Rabbe that he
should come in the next day (November 14) to make the payment when FSB’s president
would be present. And it is further undisputed that Joel Rabbe hand-delivered the payment
in full on November 14 to FSB’s presiden t, who accepted the payment, and that nobody
from FSB mentioned to Rabbe that FSB had recorded the notices of termination the
previous day.

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Based on these undisputed facts, we conclu de that FSB’s acceptance of the late rent
reaffirmed the leases between the parties. At the time FSB recorded its notice of
termination, Rabbe Ag was in default of the leases. But when the rent was paid in full on
November 14, 2017, Rabbe Ag was no longer in default because the rent for 2018 was not
due until November 1, 2018. In other words, when Joel Rabbe tendered the full amount of
the rent for the 2017 crop y ear, Rabbe Ag was in full co mpliance with the leases.
Moreover, when Joel Rabbe ma de the late rent payment, FSB’s president accepted the
payment without mentioning that the notices of termination had been recorded the previous
day, nor did he otherwise indicate that the leases had been terminated. And there is nothing
in the language of either lease indicating that a late payment of rent is a material breach of
the lease. FSB’s acceptance of the rent payments after the notices of termination were filed
demonstrate an intent to reaffirm the leases. Accordingly, while the district court should
have considered the question of intent, the district court did not err when it concluded that
by accepting the late rent, FSB waived its ri ght to recover possession and terminate the
leases. And because we conclude that FSB reaffirmed the leases when it accepted the rent,
we need not address FSB’s claim that the district court erred when it determined that FSB’s
failure to serve the Notices of Termination on Rabbe barred FSB from bringing “an action
seeking repossession of the premises.”
II. Value of John D eere’s Security Interest
FSB also challenges the district court’s determination that, under the Rabbe Ag
Plan, the value of John Deere’ s security interest in the tr actor is reflected by the total
amount of John Deere’s secured claim for the debt that Rabbe owes John Deere rather than

13
the appraised value of the tractor. FSB argues that the “plain language of the Rabbe Ag
Plan contradicts” the district court’s decision. Based on our de novo review of the Rabbe
Ag Plan, we agree.
A “Chapter 11 bankruptcy reorganization plan is a contract that may be enforced in
state court.” Baggett Bros. Farm, Inc. v. Altha Farmers Co-op., Inc., 149 So. 3d 717, 718
(Fla. Dist. Ct. App. 2014); see Voicestream Minneapolis, Inc. v. RPC Props., Inc. ,
743 N.W.2d 267, 271 (Minn. 20 08) (“An agreement entered into as compromise and
settlement of a dispute is contractual in nature.”). Thus, “principles of contract
interpretation apply to the interpretation of a reorganization plan.” In re RFC & RESCAP
Liquidating Trust Action, 332 F.Supp.3d 1101, 1142 (D. Minn. 2018).
“The primary goal of contract interpretati on is to determine and enforce the intent
of the parties.” Travertine Corp. v. Lexington-Silverwood, 683 N.W.2d 267, 271
(Minn. 2004). In a written contract, the reviewing court determines the intent of the parties
“from the plain language of the instrument itself.” Id. We must interpret a contract “in a
way that gives all of its provisions meaning.” Current Tech. Concepts, Inc. v. Irie Enters.,
Inc., 530 N.W.2d 539, 543 (Minn. 1995). When the parties’ intent is “totally ascertainable”
from a contract, our task is to “construe [the] contract as a whole and attempt to harmonize
all clauses of the contract.” Chergosky v. Crosstown Bell, Inc. , 463 N.W.2d 522, 525
(Minn. 1990). When contract terms are clea r and unambiguous, we interpret the contract
as a matter of law and “should not rewrite, modify, or limit its effect by a strained
construction.” Travertine, 683 N.W.2d at 271.

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The Rabbe Ag Plan contemplates four cl asses of secured claims: Class 1 – Martin
County Real Estate Taxes; Class 2 – Secured Claim – Ag Direct – Excavator; Class
3 – Secured Claim – John Deere Credit – Trac tor; and Class 4 – Se cured Claim – FSB.
Under these four classes, the “allowed secure d claim” represents the full amount of the
debt owed by Rabbe to the cred itor in each class. The Rabbe Ag Plan then provides the
requirements for satisfaction of each of these allowed secured claims.
As stated above, the Rabbe Ag Plan prov ides two options to Rabbe to satisfy FSB’s
allowed secured claim: the auction option and the buyout option. To satisfy FSB’s allowed
secured claim under the auction option, the “net proceeds of the auction of the Rabbe Ag
equipment” are distributed “aft er deducting the payments to be made to [the] holders of
allowed secured claims in Classes 2 and 3 as provided therein should [Rabbe] elect not to
retain the collateral securing the Class 2 and/or Class 3 claims.” (Emphasis added.) The
amount to be deducted from AgDirect’s Class 2 secured claim consists of “the lesser of the
net proceeds from the sale of [the excavator] at auction or the [$53,887.36] amount of its
allowed secured claim.” Conversely, the amount to be deducted from John Deere’s Class 3
secured claim consists of the full $211,054. 59 amount of John Deere’s allowed secured
claim, which equates to the entire amount owed by Rabbe Ag to John Deere.
The buyout option of the Rabb e Ag Plan allows Rabbe to retain the farm equipment,
but provides for satisfaction of FSB’s allo wed secured claim under a framework that is
similar to the framework set forth in the auc tion option, but different in important ways.
Rather than selling the equipment at auction, the buyout option requires the equipment to
be appraised, and Rabbe must then pay FSB a portion of the appraised value of the

15
equipment following certain deductions. Notabl y, the language regarding the deductions
for the buyout option differs from the language for the auction plan. For the buyout option,
the deductions consist of “auction and other selling fees that would have been incurred had
the equipment been sold at auction for the appraised value,” and “any senior security
interests in such collateral.” (Emphasis added.) The inte rpretation of the phrase “senior
security interests in such collateral” contained in the buyout option is the dispositive issue
before us.
FSB contends that the phrase “senior security interest[] in such collateral” as applied
to the John Deere tractor repr esents the appraised value of the John Deere tractor. We
agree. The Rabbe Ag Plan does not define “security interests.” But Article I of the Rabbe
Ag Plan incorporates the definitions of the Bankruptcy Code “by reference.” The
Bankruptcy Code defines “security interest ” as a “lien created by an agreement.”
11 U.S.C. § 101(51) (2018). “The term ‘lien’ means charge against or interest in property
to secure payment of a debt or performance of an obligation.” 11 U.S.C. § 101(37) (2018).
Moreover, the dictionary defines “security inte rest” as “[a] property interest created by
agreement or by operation of law to secure performance of an obligation, esp. repayment
of a debt; specif., an interest in personal property or fixtures securing payment or
performance of an obligation.” Black’s Law Dictionary 1562 (10th ed. 2014).
Both the Bankruptcy Code an d the dictionary definitions reflect that a security
interest is an “interest in property.” And, as FSB points out, it is axiomatic that an interest
in property cannot exceed the value of the property. The tractor had an appraised value of
$120,000. Because the value of the tractor was $120,000, John Deere’s security interest in

16
the collateral was necessarily limited to $120 ,000. Thus, the deduction for the “security
interest[] in such collateral” under the buyout option was limited to the appraised value of
the tractor. This conclusion is in accord with the plain la nguage of the Rabbe Ag Plan,
which bases the value of the equipment for pu rposes of the buyout option on an appraisal
of the equipment.
Rabbe argues that the district court corr ectly found that the phrase “senior security
interest” represents the full amount of John Deere’s allowed secured claim. We disagree.
When parties to the same contract use differe nt language to address parallel issues, it is
reasonable to infer that they intend th is language to mean different things. See
Mauer v. Kircher, 587 N.W.2d 512, 514-15 (Minn. App. 1998) (determining that different
language in nearby clauses addressing “para llel issues” expressed the parties’ “clear
intention of creating different requirements”), review dismissed (Minn. July 29, 1999).
Here, the Rabbe Ag Plan specifically uses different phrases to reference the amount
to be deducted under the buyout option and the auction option; the buyout option uses the
phrase “senior security intere st,” whereas the auction opt ion uses the phrase “allowed
secured claims.” If the parties had intended to deduct the full amount of the “allowed
secured claim” under the buyout option as well as the auction option, the parties would
have used the same language in both provisions. But they did not; instead they limited the
amount of the deduction under the buyout option to the “security interest” in the collateral.
Moreover, the provision governing John Deere’s Class 3 secured claim provides that “[i]n
full satisfaction of its allowed secured claim, John Deere Credit will retain its security
interest and will receive monthly payments of $5,000 per month . . . until the claim is paid

17
in full.” (Emphasis added.) If the deduction fo r the “security interest” in the John Deere
tractor under the buyout option referred to the full amount of John Deere’s allowed secured
claim ($211,054.59), there would be no need for additional m onthly payments of $5,000.
Thus, the plain language of the Rabbe Ag Plan demonstrates that the phrase “senior security
interest[] in such collateral” under the buyout plan does not represent the full amount of
the “secured claim.”
Rabbe also contends that because the buyout and auction options somewhat mirror
each other, “[i]t follows . . . that the deduction on account of John Deere . . . should be the
same under either scenario.” Again, we disagr ee. There is nothing in the plain language
of the Rabbe Ag Plan which indicates that the buyout option and the auction option were
intended to produce the same, or similar, resu lts. If the parties intended the deduction on
account of John Deere to be the same under both the auction and buyout options, the parties
would have used the same phrase under both options to re ference the amount to be
deducted.
Finally, Rabbe claims that the phrase “senio r security interest,” as understood within
11 U.S.C. § 506(a)(1) of the Bankruptcy Code, reflects the amount of John Deere’s allowed
secured claim rather than the appraised value of the tractor. But th is case involves a
contract dispute, and the plain language of the Rabbe Ag Plan demonstrates that the phrase
“senior security interest” refers to the appraised value of the tractor. Moreover, Rabbe’s
reliance on section 506(a) is misplaced because that section “provides that secured property
must be valued and that a claim is secu red only to the extent of such value.” In re GVM,
Inc., 605 B.R. 315, 325 n.13 (Ba nkr. M.D. Pa. Sept. 6, 2019) (citing 11 U.S.C. § 506(a)).

18
As such, 11 U.S.C. § 506(a) actually supports FSB’s pos ition that the phrase “senior
security interest” represents the appraised value of the tractor.
In sum, because the plain language of the Rabbe Ag Plan demonstrates that the value
of John Deere’s security interest in the tractor consists of the appraised value of the tractor
and not the amount of the debt Rabbe owes John Deere, we conclude that the district court
erred when it calculated the equipment buyout payment to FSB and in granting summary
judgment in favor of Ra bbe on that basis. Accordingly, we reverse, in part, the district
court’s grant of summary judgment, and rema nd for proceedings consistent with this
opinion.
Affirmed in part, reversed in part, and remanded.