If a property is underwater and/or in a blighted condition with numerous are lienholders hesitant to foreclose? The answer is often receivership. If a property is underwater, but some equity exists a receiver can be appointed to take control of the property and eventually sell the property pursuant to California Code of Civil Procedure (“CCP”) § 568.5. The receivership sale must be
Using Receiverships to Revitalize Abandoned Construction Projects
What happens when a construction project runs out of money and the half finished skyscraper, mall, or hotel sits vacant for years? There are two things that can happen; (1) while everyone waits until the developer finds funds, which is unlikely; or, (2) a more practical solution is that a developer or other party with a recorded interest can seek the appointment
LIEN STRIPPING WHY DOES IT OCCUR AND HOW DOES IT WORK?
Few people are familiar with the term lien stripping. Therefore, an example to illustrate when lien stripping would be used seems the most appropriate way to introduce the process. As an example, if in 2010 a set of parents drafted a granting $1,000,000 to their four children upon their deaths each child would be entitled to $250,000. However, what if when the
Using Receiverships to Help a Lender on a Distressed Environmental Asset Avoid Liability
Secured lenders are hesitant to foreclose when environmental problems exist, based on concerns about CEQA, CERCLA, or other environmental issues, because they may be deemed an owner or operator. However, lenders can avoid these concerns by seeking the appointment of a receiver for the distressed property. California Civil Procedure (“CCP”) § 2929.5 & 564(c) authorizes lenders to inspect property to assess the
LIEN STRIPPING: WHY DOES IT OCCUR AND HOW DOES IT WORK?
Few people are familiar with the term lien stripping. Therefore, an example of when lien stripping would be utilized can be illustrated through the following example of insufficient equity. If in 2010, a set of parents drafted a will granting $1,000,000 to their four children upon their deaths, each child would be entitled to $250,000. However, what if when the parents died
Trusts and Estates Receiverships
The intersection of trusts, wills and other estate documents and receiverships is a common occurrence. For example, a common reason that health and safety receiverships occur is that an owner passes away without any known heirs, or intestate. In situations where an owner passes away without any known heirs or intestate the property becomes abandoned and overrun, which makes the appointment of
USING RECEIVERSHIPS TO HELP LENDERS AVOID LIABILITY ON DISTRESSED ENVIRONMENTAL ASSETS
Secured lenders are hesitant to foreclose when environmental problems exist, based on concerns about CEQA, CERCLA, or other environmental issues, because they may be deemed an owner or operator. However, lenders can avoid these concerns by seeking the appointment of a receiver for the distressed property. California Civil Procedure (“CCP) § 2929.5 & 564(c) authorizes lenders to inspect property to assess the
Criminal Receiverships
Another way to utilize the receivership remedy is to preserve property that is involved in criminal activity and pay restitution to the victims of the criminal activity. Often if a person is arrested and incarcerated the question becomes what happens to their assets? A recent example of when a receiver was sought is in a criminal case is when Bernie Madoff was
Post-Judgment Receiverships
Receivers can also be used to enforce or effectuate a judgement. There are a number of ways this can arise. For example, in the City of Elk Grove there was a property that was the site of substantial criminal activity, but the code violations were not sufficient for a Health and Safety Receivership. The Property was the site of substantial criminal activity
Federal Bankruptcy is Not an Option for State Legal Cannabis Business so What Should They Do When They are Failing Financially? Appoint a Receiver
At this time, thirty-three states have legalized marijuana. ( Esquire Link ) However, marijuana remains illegal federally. 21 U.S.C. §§ 801-890 (1970.) As a result of marijuana’s status as a controlled substance federally, numerous bankruptcy courts have flatly banned state legal marijuana growers from seeking federal bankruptcy protection. In re Rent-Rite Super Kegs W. Ltd. (Bankr.D.Colo. 2012) 484 B.R. 799, 809. There was some hope that