Greetings!
 Happy, Happy
New Year to You and Yours. Well, perhaps 2010 was the year of the Tiger, but it certainly was not the year of the Creditor. As a result of the recession and abuse by some financial institutions, there has been a strong backlash by the courts against honest lenders in a way we have not experienced before. Some examples are as follows: 1. Both bankruptcy and state courts have stayed proceedings against non-debtor guarantors under the "necessary or appropriate" clause of bankruptcy code (11 USC 105); 2. State Courts have denied meritorious applications for writs of possesion against collateral after contractual defaults on the grounds that the replevin requests are too premature saying, "come back in six months!" 3. A bankruptcy appellate court held that the right to adequate protection payments is determined not as the date of the bankruptcy petition or the date of application for relief from stay, but rather on the date the creditor "would" have fully "exercised" its remedies under its contract and applicable state law by actually repossessing and selling its collateral had the bankrutpcy not been filed. The court went as far as to say that the determination of the proper date would need to take into account a hypothetical Sheriff levy, the defendant's filing a redelivery bond allowing it to retain the collateral pending trial and compliance with the disposition requirements under the Commercial Code after recovery. In other words, the date when a creditor "would" have recovered and sold the collateral making it entitled to adequate protection payments on a depreciating asset cannot actually be ascertained and therefore, might be never. 4. A State Court judge held that a vehicle lessor was liable to a buyer of an off lease "AS IS" vehicle for negligent misrepresentation and rescission where it was established that neither the lessor nor its lessee had any knowledge at the time of the sale to the buyer that the vehicle had been in an earlier accident before it was purchased by the lessor for its lessee. As we enter this New Year, we are hopeful that our continuing efforts to educate judges and juries to make sure they protect the legal rights and interests of honest creditors will prove to be successful. We produce this newsletter to keep you informed of decisions and legislation relating to your litigation and transactional matters. Some relevant and interesting recent legislation and case decisions are below. As always, we invite your suggestions on how we can improve on our service to you and welcome submissions and/or suggestions on content matter for this e-newsletter.
Best regards,
Marshall Goldberg |
Courts Increase Filing Fees
The following filing fees are now increased:
1. First appearance in an unlimited action by plaintiff(s) and each defendant increased to $395.00.
2. First appearance in a limited action ($10,000.00 up to $25,000.00) by plaintiff(s) and each defendant increased to $370.00
3. Motions for Summary Judgment or Adjudication increased to $500.00 from $335.00. |
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Lender Liable for Sanctions for Improperly Seeking Relief from Stay.
When the facts showed that a debtor was not in default, a lender that mistakenly sought relief from stay and conducted a foreclosure was found to be liable for sanctions for the debtor's emotional distress. America's Servicing Co. vs. Schwartz-Tallard (D. Nev.) |
Evidence of an Unbroken Chain of Assignmentss Critical to Establishing Proof of Ownership and a Right to a Cause of Action.
As is frequently the case, a court (in this case bankruptcy) held that a lender failed to qualify as a "creditor" (and therefore could not bring a motion for relief from the stay) because it did not prove that it was in possession of the underlying promissory note or that it was really the assignee of that note. An originating lender provided mortgage financing to a borrower. The note and mortgage were assigned to an initial assignee; the initial assignee was later taken over by the FDIC. Following the mortgagor's bankruptcy filing, a lender took a secondary assignment of the mortgage from the FDIC. Unfortunately, it is sometimes impossible to prove valid execution of assignments when the originating entities (such as failed banks) no longer exist. In re Mims (Bankr. S.D.N.Y.) |
| Settlement Made in Open Court is Enforceable Even If Not Later Reduced to Writing and Signed.
A settlement agreement confirmed in open court during trial was deemed to be binding even though the parties never reduced it to a long-form written agreement as promised to the judge, where the judge relied on the representations, dismissed the jury and terminated the trial proceedings. Blix Street Records, Inc. v. Cassidy - filed December 21, 2010, Second District, Div. Five 2010 S.O.S. 7026 http://www.metnews.com/sos.cgi?1210/B219624 |
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Contractual Arbitration Clause is Waived by Failure to Timely Assert
Failure to assert an arbitration clause for 11 months until a few weeks before the scheduled trial resulted in a waiver of a contractual arbitration provision. Burton v. Cruise - filed December 8, 2010, Fourth District, Div. Three, Cite as 2010 S.O.S. 6777 Full text http://www.metnews.com/sos.cgi?1110%2FG041835 |
Parol Evidence Admissible to Defeat Motion for Summary Judgment, Where Misrepresentation of Fact Over Content of Integrated Written Agreement Alleged.
A Lender and debtor entered into a written forbearance agreement, in which the lender agreed to temporarily forbear from pursuing collection of a defaulted loan and the debtor agreed to make specified payments and provide additional security for the debt. The written agreement provided that the debtor would pledge as additional collateral certain real property, which included the debtor's residence and a truck yard. In order to prevent foreclosure after the debtor defaulted in payments under the forbearance agreement, the debtor brought an action for fraud, negligent misrepresentation, rescission, and reformation against the lender alleging that two weeks prior to their execution of the written forbearance agreement, the lender's senior vice president represented that the debtor was to pledge only two orchards as the additional security. The trial court granted the lender's motion for summary judgment, concluding that the parol evidence rule barred admission of evidence of an oral agreement that directly contradicted the terms of the written agreement, and therefore plaintiffs had failed to raise a triable issue of material fact to prevent entry of judgment in of the lender
The Fifth Circuit Court of Appeals reversed the summary judgment stating that while a promissory fraud would be inadmissible under the parol evidence rule, a misrepresentation of fact over the content of an agreement at the time of execution, which induced entry into the contract, would fall within the fraud exception to the parol evidence rule and extrinsic evidence of the alleged misrepresentation wold be admissible in opposition to the motion. Riverisland Cold Storage,Inc. v. Fresno-Madera Production Credit Association-filed January 3, 2011, Fifth District Cite as 2011 S.O.S. 75 Full text http://www.metnews.com/sos.cgi?0111%2FF058434 |
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Commencing in 2011,
Glass & Goldberg celebrates its 25th year in business.
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Superlawyer
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Marshall Goldberg has once again been selected for inclusion in Super Lawyers for 2011 and will be listed in the February edition of Los Angeles Magazine, released on Tuesday Jan. 20, 2010. His profile and picture will be included in The New York Times (Los Angeles and
Orange County editions) on Sunday, February 6, 2011 and in the 2011 edition of Southern
California Super Lawyers magazine. Superlawyers is a listing of outstanding lawyers, comprised of no more than 5 percent of the lawyers in the state, chosen from a rigorous, multiphase process, who have attained a high degree of peer recognition and professional achievement.
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Our Members
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Glass & Goldberg is comprised of multidimensional attorneys and staff that have the utmost knowledge and experience in the legal community.
Click here to meet
our members.
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Our Practice
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Since its inception in 1986,
Glass & Goldberg has earned an unparalleled reputation in the areas of creditors' rights, commercial and business law and bankruptcy and restructuring.
Click here to learn about
what we can do for you. Your Feedback ____________
We invite you to contact us to discuss any topics presented in these articles or how we might further assist your business. Please feel free to . Visit us on the web at: Glass & Goldberg 21700 Oxnard St., #430 Woodland Hills, CA 91367
Phone: (818) 888-2220
Fax: (818) 479-9940 |
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