Banking & Financial Services Industry Legal Blog

By: Brandon C. Meadows, Esq.

Lenders take heed: the Florida Supreme Court recently amended the Florida Rules of Civil Procedure governing mortgage foreclosures. Additionally, the high court promulgated several standard forms, which reflect the amended rules. The recent rule amendments and forms are in response to the recent legislation regarding mortgage foreclosures, including the new Section 702.015, Florida Statutes, which set forth the new pleading requirements for foreclosure complaints. The purpose of the statute is to “expedite the foreclosure process by ensuring initial disclosure of a plaintiff’s status and the facts supporting that status, thereby ensuring the availability of documents necessary to the prosecution of the case.”

By: Brandon C. Meadows

When purchasing assets from a bankruptcy estate, purchasers often rely on the protections of 11 USC 363(f) of the Bankruptcy Code, which allows property to be sold “free and clear of any interest in property” if one of five statutory conditions are met. Those conditions are:
1.Applicable non-bankruptcy law permits a sale free and clear of interests;
2.The interest holder consents to the sale;
3.The interest is a lien and the sale price exceeds the aggregate value of all liens on the property;
4.The interest is in bona fide dispute; or
5.The holder could be compelled in a legal or equitable proceeding to accept money satisfaction of its interest in the property.

By Austin B Calhoun

Vendors are sometimes presented with customers going into bankruptcy. Vendors experienced in this dilemma are aware of preference actions pursuant to 11 U.S.C. § 547(b), whereby the trustee seeks to recover from the vendor all payments received from the debtor within the 90 day period prior to petition. There are various mechanisms and defenses a vendor can employ to block preference action recovery. One such tool is the critical vendor doctrine. This blog examines the steps a vendor must take to successfully implement the critical vendor doctrine in Florida bankruptcy courts.

As counsel for lenders, I’ve been consulted with and required to opine on a wide range of topics throughout my career.  Specific to financial institutions, lawyers working in our banking law practice group have knowledge of not only the legal process for special assets workouts and the regulations governing commercial […]

Lenders and trade vendors often sagely require personal guarantees from the insiders of their debtor. In the event of debtor bankruptcy, a creditor may look to the insider-guarantor to satisfy the debt. The creditor’s ability to be made whole, then, is directly related to the financial position of the insider-guarantor. There is a problem: the Deprizio doctrine can erode the insider-guarantor’s financial position. Under the doctrine, the bankruptcy Trustee may disgorge assets from the guarantor that could otherwise satisfy the debt. Luckily, there is a solution to the Deprizio problem: a carefully crafted guaranty agreement that waives the guarantor’s claim against the bankruptcy debtor. This blog post explains the problem and clarifies the solution.

The economy, to put it lightly, has not been the best in the recent years. One potentially lucrative by-product of the economic downtown was the opportunity for prospering banks to acquire failed banks from the FDIC at an incredible discount. The purchasing bank, in acquiring the failed bank, will likely enter into a Loss-Share Agreement (LSA) with the FDIC. Essentially, Loss-Share Agreements give the purchaser the benefit of the FDIC absorbing a large percentage of the losses realized on the acquired receivables. The purchasing bank, generally speaking, only incurs around 20% of the losses with the FDIC incurring the remaining 80%. While this seems like a “no-brainer” agreement, entering into a LSA—much like every contract—requires scrutiny to maximize revenue and avoid potential lawsuits. Beyond the general advice of reading every word prior to signing a contract, this Blog post identifies five things an inquiring bank needs to know about LSAs.

What do you do when a client comes to you stating that a default final judgment was entered against them and they want out of it? The answer is you move to set it aside for cause, which is a viable plan of action under state law as well as federal bankruptcy law. Entry of a final judgment after default is not necessarily the end of the road for your client. In certain circumstances, it may just be the beginning.

Previously we have explored: a) successful defenses to enforcement of personal guaranties, b) unsuccessful defenses to enforcement of personal guaranties, c) language requirements for personal guaranties, and lastly we will explore the obligation of an alleged guarantor when a personal guaranty is forged.

Most of the cases alleging an insufficiently drafted  personal guaranty concern corporate officers guarantying corporate debt, and the officer’s  subsequent defense that he was signing in a strictly representative capacity.  In deciding these cases, courts have also outlined the language requirements for a valid guaranty. This post is the third […]

This post is the second part of a two part series examining defenses to enforcement of personal guaranties in Florida. Part one identified successful defense to enforcement of a guaranty and can be found here. Part two seeks to analyze defenses that have been unsuccessfully asserted in defense of personal guaranty enforcement.