Real Estate Cases: You May Want to Think Twice Before You File

Branch Bank & Trust Co. v. Michael’s Enterprises of Virginia, Inc. (In re Michael’s Enterprises of Virginia, Inc.), 519 B.R. 916 (Bankr. E.D. Va. 2014)  –

A mortgage lender sought sanctions against the debtor, its sole shareholder and its attorney.  It alleged that the bankruptcy petition was filed for an improper purpose. Continue reading

Posted in Financing, Real Estate | Tagged , , | Leave a comment

Real Estate Cases: Bad Faith Filing Does Not Necessarily Mean That You Are A Bad Person

In re Sterling Bluff Investors, LLC, 515 B.R. 902 (Bankr. S.D. Ga. 2014) –

A mortgagee moved to dismiss a real estate debtor’s chapter 11 case, or in the alternative for relief from the automatic stay.  It contended that the debtor filed bankruptcy in bad faith, and that this was a “single asset real estate” case subject to special provisions regarding its entitlement to relief from the stay. Continue reading

Posted in Financing, Real Estate | Tagged , , | Leave a comment

Post-Confirmation: Ignoring Court Orders Is Not A Good Idea

In re Castle Home Builders, Inc., 520 B.R. 98 (Bankr. N.D. Ill. 2014) –

The debtors obtained confirmation of plans of reorganization that restructured prepetition mortgage loans.  When the servicer for some of the loans continued to ignore the terms of the plans, the reorganized debtors sought enforcement of the court’s confirmation order and sanctions. Continue reading

Posted in Financing, Real Estate | Tagged , , | Leave a comment

Bankruptcy Sales: “It Ain’t Over ’Til It’s Over”

Great Plains Royalty Corp. v. Earl Schwartz Co. (In re Great Plains Royalty Corp.), 520 B.R. 292 (Bankr. D. N.D. 2014) –

Two companies that acquired assets in a bankruptcy auction moved to reopen the case to clarify ambiguities in the conveyance documents.  After the case was reopened, the debtor commenced an adversary proceeding to resolve disputes regarding the legal status of certain of the assets.  An interesting twist:  the sale that gave rise to this decision took place 45 years ago in 1969. Continue reading

Posted in Bankruptcy Sales | Tagged , | Leave a comment

Proof of Claim: Foreign Qualification Requirements May Be More Important Than You Thought

In re Flex Fin. Holding Co., 518 B.R. 891 (Bankr. D. Kan. 2014) –

A landlord filed a proof of claim for ~$1.34 million for a debtor’s prepetition breach of its lease.  The debtor objected based on the landlord’s failure to qualify to do business in the state where the leased property was located – arguing that this provided a defense to the claim under nonbankruptcy law and the landlord lacked the capacity to file the claim. Continue reading

Posted in Uncategorized | Tagged , | Leave a comment

UCC Collateral Description: More May Not Be Better

Ring v. First Niagara Bank, N.A. (In re Sterling United, Inc.), 519 B.R. 586 (Bankr. W.D.N.Y. 2014) –

A chapter 7 trustee sought to recover as preferences payments made by the debtor to a lender and proceeds of collateral liquidation received by the lender based on arguments regarding whether UCC financing statements adequately perfected the lender’s security interests. Continue reading

Posted in Financing | Tagged , , , | Leave a comment

Prepetition Stay Waivers: Which Way Is The Wind Blowing?

In re Triple A & R Inv., Inc., 519 B.R. 581 (Bankr. D. P.R. 2014) –

A mortgagee moved for relief from the automatic stay based on the debtor’s prepetition consent to stay relief.  The debtor argued that a prepetition waiver was unenforceable. Continue reading

Posted in Financing, Real Estate | Tagged , , | Leave a comment