Special Assets Lawyer Blog

A few years ago, the Special Assets Management Association (SAMA) was born in Southern California. SAMA is a member-driven non-profit organization dedicated exclusively to fostering the best practice in the workout arena through continuing education, mentoring, skill sharing and peer support. I hear from my partners and clients in Southern California that SAMA has been quite successful in providing continuing education for workout professionals as well as a platform for workout professionals to network with one another.

SAMA is now coming to Northern California, and I am privileged to be a member of the Event Planning Committee that will be working to get SAMA North off the ground.

Our first event will be a breakfast program in San Francisco on December 8 on "Current State of the Workout" featuring Greg Bloyd of Bank of the West and Seth Moldoff of Wells Fargo Bank. The meeting will be held at Silk's Restaurant in the Mandarin Oriental Hotel at 7:30 a.m. I hope that you can join us that morning to inaugurate SAMA in Northern California.

Continue reading "SAMA Comes to Northern California" »

In these times of declining property values, lenders are often faced with the prospect of taking back property that will prove to be difficult to manage as ORE. One time-honored means of administering these properties is to move for the appointment of a receiver and ask the Court to authorize the receiver to sell the property and disburse the proceeds in the appropriate priority.

Receiver's sales are useful in any number of circumstances. One of the best examples was in the liquidation of a failed farm implement dealership. The bank held a deed of trust on the real property, but property was chock full of equipment, tools, old engine blocks and decades of what looked a lot like junk. The bank received very high bids from salvage companies to haul it all away. Instead, the receiver held an auction and sold off all of the personal property. Result: instead of paying $100 to haul off an old engine block, a buyer at the auction paid $100 for the privilege of hauling it off! When the dust settled at the end of the auction, the yard was reasonably clean, most of the personal property had been removed by auction buyers, there was sufficient cash available to cover the cost of the auction and the receivership, as well as some left over for other expenses.

Meanwhile, the receiver had listed the property for sale. Once the property was cleaned up, buyers appeared and the property was soon liquidated for enough to repay the secured lender with some left over.

We've also used receiver's sales to sell property where there were documentation issues, such as where one lender held a deed of trust on the real property and another held a personal property security interest in the essential personal property. (Yes, a real lesson in underwriting!!) The receiver, as the neutral representative of the Court, was able to sort out which lender was entitled to what sums and get the property sold as a package to a buyer.

Now comes a decision that threatens to end receiver's sales. My partner, Joe Demko, who has handled countless receivership matters over the years, files this comment on a very troubling decision.

Continue reading "California Court Decision Threatens to End Receiver's Sales of Real Property" »