FLORIDA FORECLOSURE LITIGATION, LOAN WORKOUTS, AND MORTGAGE MODIFICATIONS
We handle secured loan litigation, including commercial foreclosure defense and lender liability claims, receivership defense, commercial loan guaranty enforcement defense, and commercial loan workouts. We also handle significant residential foreclosure defense cases that either present a unique question of law or fact, or involve a borrower that is facing nearly incomparable personal circumstances.
We approach our secured loan litigation cases with the basic premise that, in time and through the adversarial process which fairly exposes the risks and strengths of each side’s position, a solution is ultimately achievable for the borrower and the lender that either enables the borrower to remain in possesion and occupy and/or operate the property under a restructured loan, or affords the borrower the opportunity to transfer ownership of the property to the lender in a predictible and orderly manner and move forward with their life.
Florida foreclosure litigation defense is not new to us. Our experience in this field began long before the recent mortgage crisis in 2008 to the present. In the late 1980’s, our national economy faced a similar lending crisis to the recent sub-prime mortgage crisis, except that the issues at that time surrounded the commercial lending policies of federal savings and loan institutions. In one of the cases we handled at that time, Sunrise Savings and Loan Association v. LIR Development Co., our client was the developer of a large residential condominium community in Delray Beach, Florida then known as the “Laver’s Resort.” Our client constructed numerous condominium buildings and recreational amenities and had been promised many things by its lender, Sunrise Savings & Loan, relating to the amount of funding the lender would provide and the terms and conditions under which the loan would renew/revolve to allow construction and sale of future units to be developed.
The representations upon which our client relied when it obtained financing from Sunrise Savings & Loan were attested to and in writing by the lender, but when the lender failed due to its own internal illegal activities and was taken over by the Federal Deposit Insurance Corporation (“FDIC”) as receiver, extremely unique questions of law arose as to whether the obligations of the original lender would be enforceable against the FDIC as receiver, and whether the developer/borrower could assert claims (“lender liability claims”) against the lender for breaching these promises.
We proudly litigated these unique questions of law in Florida state and federal courts for six (6)+ years, circa 1986-1992, vigorously arguing throughout that, when the FDIC succeeded to the rights of the original lender under the loan instruments, it similarly assumed responsibility to perform the obligations of the original lender to the borrower/developer. While our arguments were ultimately unsuccessful when these highly complex legal issues were eventually ruled upon by the federal appellate courts, the body of law that evolved during this litigation rested upon the doctrine that, as a matter of federal public policy, it was Congress’ intention that the FDIC be free to operate unencumbered by the commitments formerly made by a federal savings and loan that had subsequently failed.
As with real estate litigation generally, mortgage loan litigation defense and secured loan workout/restructuring law are highly complex legal areas which require the talent of experienced commercial trial lawyers who are knowledgeable in commercial and residential lending law in addition to real estate development law. Frequently, the properties in foreclosure are encumbered by third-party construction liens and many times governmental approvals are nearing expiration, and a comprehensive settlement strategy must be employed which takes into account the relationship of the borrower not only to the lender, but to other parties who are involved in the real estate development process.
Our experience in foreclosure defense spans more than twenty-five (25) years and runs the gamut from mortgage loans in the amount of less than $1 million to those greater than $20 million. We have the ability to handle any commercial foreclosure defense and/or the workout/restructuring of any mortgage loan in any dollar amount and having any degree of complexity throughout the state of Florida.