J-A19021-21

2021 PA Super 226

STEPHEN RATNER, AUDREY RATNER, 

AND DR. ROBERT OSTOYICH 

Appellants

v.

IRON STONE REAL ESTATE FUND, I, 

L.P., IRON STONE REAL ESTATE 

GROUP I, LLC, AND ANDREW 

EISENSTEIN

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 IN THE SUPERIOR COURT OF

 PENNSYLVANIA

 No. 339 EDA 2021

Appeal from the Order Entered December 18, 2020

In the Court of Common Pleas of Philadelphia County

Civil Division at No. 170301497

BEFORE: DUBOW, J., MURRAY, J., and COLINS, J.*

OPINION BY MURRAY, J.: FILED NOVEMBER 19, 2021

Stephen Ratner, Audrey Ratner, and Dr. Robert Ostoyich (Appellants),

appeal from the order discharging the receiver in this partnership dissolution 

action.

1

 For the second time, we are constrained to vacate and remand.

We previously explained:

On August 17, 2005, a Certificate of Limited Partnership was filed 

with the Secretary of State of the Commonwealth of Pennsylvania 

to form a limited partnership named Iron Stone Real Estate Fund 

I, L.P. [Iron Stone LP] under the Pennsylvania Revised Uniform 

Limited Partnership Act, as amended. See 15 Pa.C.S. §§ 8501-

8594 (Repealed). On February 28, 2006, [Iron Stone Real Estate 

Group I, LLC (Iron Stone)] entered into “An Agreement of Limited 

Partnership of the Iron Stone Real Estate Fund I, L.P.” Section 3 

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* Retired Senior Judge assigned to the Superior Court.

1 This appeal is interlocutory pursuant to Pa.R.A.P. 311(a)(2), which permits 

an appeal as of right from an order dissolving a receivership.
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of the Limited Partnership Agreement provided the purpose of 

Limited Partnership “to acquire, hold, maintain, operate, develop, 

sell, improve, lease, license, pledge, encumber, dispose of and 

otherwise invest in, directly or indirectly, real estate and related 

assets.”

Stephen Ratner and Audrey Ratner purchased two units out of 100 

(a 2% ownership interest for a total of $200,000). Dr. Robert 

Ostoyich purchased one unit out of 100 (a 1% ownership interest 

for $100,000) as limited partners in Iron Stone LP [of which Iron 

Stone], was the general partner.

Ratner v. Iron Stone Real Estate Fund I, L.P., 212 A.3d 70, 72-73 (Pa. 

Super. 2019) (record citations and footnotes omitted), appeal denied, 224 

A.3d 368 (Pa. 2020), cert. denied, 141 S.Ct. 554 (2020) (Ratner I).

The parties’ dispute arose after Iron Stone unilaterally sought to extend 

the limited partnership beyond the end date set forth in the partnership 

agreement.2 We stated:

After their demand for payment of the value of their units, for an 

accounting of the value of their “units” and/or for the proper 

dissolution of the Partnership was refused, [Appellants] filed a 

Complaint, later amended, and not as a derivative action brought 

on behalf of Iron Stone LP and/or the Limited Partners, as a class. 

The Amended Complaint asserted six causes of action alleging 

Breach of Fiduciary Duty (Count I), Breach of Implied Duty of 

Good Faith and Fair Dealing (Count II), Breach of Contract (Count 

III), Accounting (Count IV), Dissolution of Partnership (Count V) 

and Conversion (Count VI).

* * *

On preliminary objections, the trial court dismissed [Appellants’]

claims for breach of the implied duty of good faith and fair dealing 

and conversion. After the close of the pleadings, cross-motions 

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2 We incorporate the factual and procedural history from Ratner I, 212 A.3d 

at 72-76.
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for summary judgment were filed. Iron Stone sought dismissal of 

the remaining counts for breach of contract, breach of fiduciary 

duty, accounting and dissolution because the Limited Partners did 

not have standing to maintain those claims because they were 

derivative in nature and that the duration of the contract had been 

properly extended. In its cross-motion for summary judgment, 

[Appellants] maintained the opposite but only sought dissolution 

of the Partnership. The trial court granted Iron Stone’s motion and 

denied [Appellants’] motion for summary judgment.

Id. 75-76 (record citation and footnote omitted).

On appeal, this Court affirmed the grant of summary judgment as to 

Count I (breach of fiduciary duty), Count II (breach of implied duty of good 

faith and fair dealing), and Count VI (conversion), holding that Appellants 

lacked standing. Id. at 77. We reversed as to Count III (breach of contract), 

Count IV (accounting), and Count V (dissolution of partnership), and 

remanded “to the trial court to enter an order that the Limited Partnership 

shall wind up its activities and affairs in accordance with 15 Pa.C.S. § 

8682.” Id. at 81 (emphasis added).

3

Iron Stone sought reargument en banc, which this Court denied on July 

31, 2019. Iron Stone then sought — without success — allowance of appeal 

with the Pennsylvania Supreme Court, reconsideration of the Pennsylvania 

Supreme Court’s denial of their request for allowance of appeal, and a writ of 

certiorari with the United States Supreme Court.

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3 Our reasoning is detailed in Ratner I, supra, at 75-81.
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After the case was remanded to the trial court, Appellants filed a motion 

to appoint a receiver pursuant to 15 Pa.C.S.A. § 8682(d)(2).4 Iron Stone

opposed the motion. On November 10, 2020, the trial court appointed a 

receiver, finding:

[Appellants] in their motion have provided more than a 

sufficient basis to support the good cause requirement for 

judicial supervision in 15 Pa.C.S.A. § 8682(d)(2). A neutral 

review of the records of [Iron Stone] are essential to a fair 

resolution of this case. [Iron Stone’s] peremptory action in 

beginning the process of winding down and dissolution without the 

participation of [Appellants] is in contravention of the Superior 

Court’s direction. Moreover, the manner in which the case 

has been proceeding, including the most recent final 

“distribution” of November 5, 2020, issued while this 

motion was pending, argues in favor of court supervision 

to ensure the fairness of this process for all parties.

Order, 11/10/20, at unnumbered p. 1 n. 1 (emphasis added). The court 

directed that the parties “equally share” responsibility for paying the receiver’s 

fees. Id. at unnumbered page 3. 

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4 The statute provides:

On the application of a partner or person entitled under subsection 

(c) to participate in winding up, the court may order judicial 

supervision of the winding up of a dissolved limited 

partnership, including the appointment of a person to wind 

up the partnership’s activities and affairs, if:

* * *

(2) the applicant establishes other good cause.

15 Pa.C.S.A. § 8682(d)(2) (emphasis added).
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Thereafter, a dispute arose concerning payment of the receiver. On 

December 3, 2020, the trial court directed the parties to file briefs “of not 

more than five pages in length addressing the issue of the proper allocation 

of responsibility for payment of the Receiver’s fees and costs.” Order, 12/3/20 

(footnote omitted). 

However, two weeks later, the trial court sua sponte issued the order

giving rise to this appeal. The court discharged the receiver without 

explanation, other than stating “the dissolution and winding up of the Limited 

Partnership has already occurred.” Order, 12/18/20. The court acknowledged

that Appellants believed the partnership had not been resolved in accordance 

with 15 Pa.C.S.A. § 8682, but concluded Appellants’ objections to the manner 

in which Iron Stone dissolved the limited partnership should be raised in a 

new action.5 Id. at n. 2.

Appellants timely appealed. The trial court did not order a Pa.R.A.P. 

1925(b) concise statement. On March 1, 2021, the court issued a brief opinion 

referencing the December 18, 2020 order.

Appellants present six questions for our review:

1. Did the Trial Court commit an error of law by finding that the 

dissolution and winding up of the Limited Partnership (as 

required by this Court’s May 29, 2019 Opinion and Order) had 

occurred, such that the Receiver appointed by the Trial Court 

on November 10, 2020 was no longer needed?

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5

In contravention of Ratner I, the trial court never issued an order directing 

the partnership be dissolved in compliance with 15 Pa.C.S.A. § 8682.
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2. Did the Trial Court abuse its discretion by terminating the 

Receiver after the parties submitted briefs at the Trial Court’s 

request, reviewing how the appointed Receiver was to be 

compensated?

3. Did the trial court commit an error of law by not requiring the 

Receiver’s fees and costs to be paid out of the assets 

marshalled?

4. Did the trial court commit an error of law by previously 

requiring [Appellants] be responsible for paying 50% of the 

Receiver’s fees and costs, despite the fact that [Appellants]

only hold 3% of the Units in the Limited Partnership?

5. Did the Trial Court commit an error of law by allowing [Iron 

Stone] to perform an “in-kind” distribution of the matured 

Partnership’s stock into a separate operating entity, rather than 

requiring a court appointed receiver to perform a full liquidation 

of the Limited Partnership’s assets?

6. Did the Trial Court commit an error of law by not granting 

[Appellants] attorney’s fees in this matter, when it has been 

repeatedly demonstrated that [Iron Stone] engaged in serial 

bad acts designed solely to delay and prolong this matter and 

to increase [Appellants’] legal costs?

Appellants’ Brief at 3.6

“We initially recognize that the lower court’s decision to appoint [or 

remove] a receiver will not be reversed absent a clear abuse of discretion.” 

Metropolitan Life Ins. Co. v. Liberty Center Venture, 650 A.2d 887, 889 

(Pa. Super. 1994) (citation omitted). 

In their first two issues, Appellants claim the trial court erred in 

discharging the receiver. They state:

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6 We reordered Appellants’ issues for disposition.
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The [t]rial [c]ourt properly found on November 10, 2020 that 

there was good cause under 15 Pa.C.S.A. § 8682(d)(2) for the 

appointment of a receiver so that this matter could finally be 

concluded[.] . . . The [t]rial [c]ourt found [Iron Stone] had 

engaged in improper, unilateral actions, and [there] were 

improper attempts by [Iron Stone] to avoid the instructions of the 

Court[.] ... However, when the parties could not agree on the 

apportionment of the [r]eceiver’s fees, the [t]rial [c]ourt 

requested and received briefs outlining and analyzing how the 

appointed [r]eceiver’s fees and costs should be apportioned. 

Curiously, instead of issuing an order on the appointment 

of the [r]eceiver’s fees and costs, the [t]rial [c]ourt 

somehow found that the [r]eceiver was not needed

anymore. The [t]rial [c]ourt’s finding makes no sense[.]

Appellants’ Brief at 32-33 (emphasis added).

Iron Stone counters that the appointment of the receiver exceeded the 

scope of remand because the “sole instruction on remand was for the [t]rial 

[c]ourt to enter an order that Iron Stone LP shall wind up its activities and 

affairs in accordance with 15 Pa.C.S. § 8682.”7 Iron Stone’s Brief at 17. Iron 

Stone contends the appointment of the receiver was unnecessary because 

“the trial court properly determined . . . Iron Stone [had] wound up its

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7 At oral argument, Iron Stone asserted that 15 Pa.C.S.A. § 8682(d)(2) does 

not authorize the appointment of a receiver because that term is not used in 

the statute. Black’s Law Dictionary defines a receiver as a “disinterested 

person appointed by a court, or by a corporation or other person, for the 

protection or collection of property that the subject of diverse claims.” Black’s 

Law Dictionary, 647 (5th Pocket ed. 1996). As noted above, 15 Pa.C.S.A. § 

8682(d) provides for the appointment of “a person to wind up the 

partnership’s activities and affairs.” A receiver clearly falls within this 

definition, and thus Iron Stone’s argument is one of semantics and 

unpersuasive. 
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activities and affairs in accordance with 15 Pa.C.S. § 8682 and dissolved.”

8

 

Id. at 18.

The Pennsylvania Rules of Appellate Procedure provide:

(a) General rule. On remand of the record the court or other 

government unit below shall proceed in accordance with the 

judgment or other order of the appellate court and, except as 

otherwise provided in such order, Rule 1701(a) (effect of appeals 

generally) shall no longer be applicable to the matter.

Pa.R.A.P. 2591(a). The Supreme Court has stated, “it has long been the law 

in Pennsylvania that following remand, a lower court is permitted to proceed 

only in accordance with the remand order.” Commonwealth v. Sepulveda, 

144 A.3d 1270, 1280 n. 19 (Pa. 2014). Further, “where a case is remanded 

for a specific and limited purpose, issues not encompassed within the remand 

order may not be decided on remand.” Id. (citation omitted). 

As noted above, 15 Pa.C.S.A. § 8682(d)(2) provides for appointment of 

a receiver upon good cause shown. On remand, the trial court found Iron 

Stone unilaterally dissolved the partnership in their favor and in contravention 

of Ratner I and 15 Pa.C.S.A. § 8682. Order, 11/10/20, at unnumbered p. 1 

n. 1. Iron Stone’s actions suggest it leveraged the delay that resulted from 

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8

Iron Stone’s claim that the trial court found the partnership was dissolved in 

compliance with 15 Pa.C.S.A. § 8682 is not supported by the record; the court 

did not make such finding, and to the contrary, it found there was good cause 

for the appointment of the receiver because Iron Stone was not compliant with 

15 Pa.C.S.A. § 8682. 
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litigation, i.e., the judicial process, to proceed with dissolving the partnership 

in their favor and adverse to Appellants. 

Given Iron Stone’s actions, the trial court acted properly and in 

accordance with Ratner I and 15 Pa.C.S.A. § 8682 by appointing a receiver. 

However, it abused its discretion by discharging the receiver. As quoted 

above, the court found “more than a sufficient basis to support the good cause 

requirement” to appoint a receiver because Iron Stone was dissolving the 

partnership without input from Appellants, in a “peremptory” manner, and “in 

contravention of the Superior Court’s direction.” Order, 11/10/12, at 

unnumbered page 1, n. 1. The court also expressed concern about the 

manner in which Iron Stone distributed the partnership proceeds. Id. In the 

month between the order appointing the receiver and the order discharging 

the receiver, the only events that transpired — at least on the record — are

that the parties disputed responsibility for payment of the receiver, and Iron 

Stone completed the dissolution without complying with Ratner I and without 

“judicial supervision to ensure the fairness of the process.” Id., see also 15 

Pa.C.S.A. § 8682(d)(2). Thus, in its December 18, 2020 order, the court

flouted its November 10, 2020 order, effectively penalizing Appellants for 

questioning the payment of the receiver, and rewarding Iron Stone’s actions 

in dissolving the partnership during the pendency of litigation. 

We further disagree with the trial court’s finding, without support or 

explanation, that Appellants could seek recourse by raising their claims 
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regarding dissolution in a new action. Order, 12/18/20, at 2 n. 2. We are 

further concerned that the court acknowledged, but did not disturb, Iron 

Stone’s unilateral actions in making an in-kind distribution, which is barred by 

15 Pa.C.S.A. § 8653(c) and contrary to Ratner I.

In sum, and in response to Appellant’s first two issues, we agree the 

trial court abused its discretion in discharging the receiver. We therefore 

vacate the December 18, 2020 order and remand for the trial court to 

reappoint the receiver in accordance with the instructions below relating to 

Appellants’ third and fourth issues.

In their third and fourth claims, Appellants argue the trial court erred in 

equally allocating the parties’ responsibility for payment of the receiver’s fees

and costs. Appellants’ Brief at 41-53, 55-58. Iron Stone maintains that if the

receiver is necessary — which it disputes — Appellants should bear the 

expense because they requested the appointment. Iron Stone’s Brief at 25.

The trial court did not explain its allocation of the receiver’s fees. 

However, it found good cause for the appointment of the receiver “to ensure 

fairness” due to Iron Stone’s “peremptory” activities “in contravention” of 

Ratner I. Order, 11/10/20, at unnumbered p. 1. n. 1. We thus see no 

equitable basis for allocating to Appellants, who are minority shareholders, 

half of the cost. 

Section 8682 does not address payment of the receiver and we have 

found no relevant legal authority on this issue. However, the federal law cited 
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by Appellants is persuasive.

9

 The United States Supreme Court has stated 

that as a general rule, the expenses of a receiver are “a charge upon property 

or fund under the control of the court, without any personal liability therefor 

upon the part of the plaintiff, who invoked the jurisdiction of the court.” 

Atlantic Trust Co. v. Chapman, 208 U.S. 360, 372 (1908). See also 

O’Leary v. Moyer’s Landfill, Inc., 677 F.Supp. 807, 822 (E.D.Pa. 1988) 

(citing Atlantic Trust and noting receivership expenses are generally charged 

to the property). More recently, federal district courts have approved the 

practice of receivers charging fees and costs against funds recovered. See 

e.g. KeyBank Nat’l Ass’n v. Fleetway Leasing Co., 2019 WL 5102206, at 

*1 (E.D.Pa. Oct. 11, 2019) (noting with approval receiver held 25% of 

recovered funds to pay costs); SEC v. Ahmed, 2018 WL 6737318, at *2 

(D.Conn. Dec. 20, 2018) (holding “all costs of the receivership in this case will 

be paid from among the assets of the Receivership Estate.”). This manner of 

payment is in keeping with Pennsylvania law in other areas, such as estate 

law, where an executor is authorized to charge the estate for expenses. See 

e.g. In re Estate of Whitley, 50 A.3d 203, 210 (Pa. Super. 2012) (affirming 

trial court’s holding that executor properly charged estate for fees). 

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9 “While we recognize that federal court decisions are not binding on this court, 

we are able to adopt their analysis as it appeals to our reason.” Kleban v. 

Nat. Union Fire Ins. Co. of Pittsburgh, 771 A.2d 39, 43 (Pa. Super. 2001) 

(citation omitted).
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Accordingly, on remand, the trial court in its order reappointing the receiver 

shall direct that the receiver’s fees and costs be paid from funds recovered 

from the partnership.

10

 

Accordingly, and for the above reasons, we vacate the December 18, 

2020 order discharging the receiver, and remand for reappointment of the

receiver, with the receiver’s fees and costs to be paid from partnership funds; 

the parties may raise, and the court shall address, any issues encompassed 

by this remand as well as our remand in Ratner I.

11

 Commonwealth v.

Sepulveda, supra.

Order vacated. Case remanded for further proceedings consistent with

this decision. Jurisdiction relinquished.

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10 Appellants’ two remaining issues concern the trial court’s decision to let 

stand Iron Stone’s “in-kind” distribution, and the court’s failure to rule on 

Appellants’ petition for attorney’s fees. Because we grant relief on Appellants’

first four issues and are again remanding to the trial court, we do not address 

these issues, as Appellants may proceed with them before the trial court on 

remand. See Siegal v. Stefanyszyn, 718 A.2d 1274, 1277 n. 6 (Pa. Super. 

1998). 

11 Appellants seek to have the receiver: “(a) collect on all loans made to 

related parties as part of the marshalling of all assets, (b) liquidate the Limited 

Partnership’s property including the sale of either the Falls Center Campus or 

the sale of the Partnership’s holdings in that real estate entity, (c) investigate 

[Iron Stone’s] failure to make proper distributions to the limited partners from 

previously sold real estate, and (d) claw back the [] administrative and 

management fees received after December 31, 2015, (e) pay over the 9% 

annual priority returns due to the limited partners since 2006, and (f) conduct 

a forensic review of the [] books and records [] so as to ensure that the proper 

final distribution be made [].” Appellants’ Brief at 57-58.
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Judgment Entered.

Joseph D. Seletyn, Esq.

Prothonotary

Date: 11/19/2021