In a recent decision, causation proved to be a determinative factor in the viability of multiple claims subject to the same force majeure clause. District judge rules that broad.
The Courts’ View of UCC Article 9 Sales in The COVID-19 Environment Is Clearly Changing -
While the world may be in a state of semi-paralysis waiting for a COVID-19 vaccine, the legal environment involving creditors’ rights has changed significantly during the past several months.
In the beginning of the pandemic, we reported that courts viewed Article 9 sales with a more critical eye. For example, we previously reported that Justice Masley of the New York Supreme Court, New York County Commercial Division, issued a decision on June 23, 2020 in D2 Mark LLC v. OREI VI Investments, LLC, holding that a UCC Article 9 sale on thirty-six (36) days’ notice, which required the winning bidder to make a non-refundable deposit of 10% of the purchase price, pay the remaining balance within 24 hours, and precluded the borrower from submitting a bid, was commercially unreasonable because of the dire implications of COVID-19. MHH Blog: Lender Stayed From Proceeding With UCC Article 9 Sale
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During the COVID-19 pandemic, New York State courts have granted a number of preliminary injunctions enjoining UCC foreclosures for a period of time. For example, in
D2 Mark LLC vs. Orei VI Investments LLC and
Shelbourne BRF LLC, Shelbourne 677 LLC v. SR 677 BWAY LLC, the courts found that elements of the UCC foreclosures were not commercially reasonable as a result of the pandemic and temporarily prevented the UCC foreclosures.
1 However, not all borrowers have had the same success with preliminary injunctions. In
893 4th Avenue Lofts LLC vs. 5AIF Nutmeg, LLC, 893 4th Avenue Lofts LLC was the borrower (the “
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COVID-19 Update: Can’t Lose What You Never Had: New York State Court Rejects Argument that a Pledge of the Equity Interests in an Entity that Owns Real Property Requires Foreclosure under RPAPL Article 13 Wednesday, January 13, 2021
During the COVID-19 pandemic, New York State courts have granted a number of preliminary injunctions enjoining UCC foreclosures for a period of time. For example, in
D2 Mark LLC vs. Orei VI Investments LLC and
Shelbourne BRF LLC, Shelbourne 677 LLC v. SR 677 BWAY LLC, the courts found that elements of the UCC foreclosures were not commercially reasonable as a result of the pandemic and temporarily prevented the UCC foreclosures.