Assignment of Rents Enforcement After a Default: Receivership, Foreclosure, and Bankruptcy Issues
Best Practices in Drafting an Assignment of Rents and Leases
Recording of a 90-minute premium CLE video webinar with Q&A
This CLE webinar will discuss the different approaches that state and bankruptcy courts have taken to the exercise of assignment of rent remedies and how those approaches should inform the drafting of an assignment of rents and lease documents in a commercial mortgage transaction.
Outline
- General purpose of assignment of rents: security (or immediate) interest in rents
- How the mortgagee generally exercises remedies
- Taking possession of a property
- Receivership
- Notice to tenants
- Differing state requirements for enforcement: Uniform Assignment of Rents Act
- Collection issues in bankruptcy
- Significance of collateral vs. absolute assignment
- Key takeaways for drafting and assignment of leases and rents
Benefits
The panel will review these and other vital issues:
- What is the significance of an assignment of rents in a commercial mortgage transaction, and why is it often a separate document from the mortgage?
- How is an assignment of rents perfected, and what issues can arise in enforcement?
- What is collateral assignment as opposed to an absolute assignment, and why would a lender prefer the latter?
- How does the borrower's bankruptcy affect the lender's ability to enforce an assignment of rents?
Faculty
Gary M. Kaplan
Partner, Chair Restructuring, Insolvency and Creditors Rights Practice Group
Farella Braun + Martel
Mr. Kaplan has decades of experience representing debtors, creditors, creditors' committees, trustees, and... | Read More
Mr. Kaplan has decades of experience representing debtors, creditors, creditors' committees, trustees, and receivers in a wide range of bankruptcy and nonbankruptcy matters. His practice includes both out of court and Chapter 11 restructurings and advising clients regarding pre- and post-bankruptcy strategy, debt collection, judgment enforcement, and provisional remedies. Mr. Kaplla represents lenders and borrowers in a wide range of financing transactions, including debtor-in-possession financing, as well as lease and guaranty matters. He also has extensive litigation experience in bankruptcy and non-bankruptcy courts, at trial and appellate levels, including in the U.S. Supreme Court. Mr. Kaplan counsels companies and individuals experiencing financial and operational challenges in myriad industries. He helps clients restructure their finances, build and negotiate sustainable workout plans with creditors, and develops other creative solutions to avoid bankruptcy, including refinancings, divestitures, joint ventures, and licensing deals. Mr. Kaplan also represents both secured and unsecured creditors, creditors’ committees, landlords, and equity holders in creative recovery solutions in and outside of bankruptcy. He has proved adept at protecting landlord’s rights in retailer bankruptcy cases nationwide through negotiation and litigation when necessary. He has extensive experience in insolvency-related litigation, including preference and fraudulent transfer claims, as well as defending guarantors, owners, directors and officers.
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Scott R. Lesser
Principal
Miller, Canfield, Paddock and Stone
As a leader on the firm’s highly experienced Commercial Real Estate Workout Team, Mr. Lesser uses his knowledge... | Read More
As a leader on the firm’s highly experienced Commercial Real Estate Workout Team, Mr. Lesser uses his knowledge and expertise to avoid and resolve his clients' concerns before they develop into true issues. He prides himself on guiding his clients and fellow practitioners alike to practical solutions to distressed real estate and finance situations. In pursuing this end, he co-authors the Michigan Chapter on Receiverships for Strategies For and Against Distressed Businesses, co-authors the "Foreclosure of Mortgages and Land Contracts: Receiverships" chapter in the LexisNexis Practice Guide to Michigan Real Estate Litigation, and is a frequent speaker on distressed asset topics. In addition to representing special servicers, financial institutions, private investors and other creditors, Mr. Lesser also leverages his real estate litigation experience to help title insurance companies, receivers, property owners, real estate investors involved in ownership disputes, real estate developers and others work through difficult circumstances.
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A.J. Webb
Partner, Bankruptcy and Restructuring Practice Group Leader
Frost Brown Todd
Mr. Webb counsels companies facing varying degrees of financial uncertainty and distress, working to proactively... | Read More
Mr. Webb counsels companies facing varying degrees of financial uncertainty and distress, working to proactively identify and assess insolvency issues. He represents parties (secured/unsecured creditors, debtors, committees, purchasers, and borrowers) in all phases of bankruptcy and insolvency proceedings, with an emphasis on selling or acquiring distressed assets and assisting parties in restructurings or out-of-court workouts. Additionally, Mr. Webb counsels clients on general corporate and commercial matters and has also prosecuted or defended numerous avoidance actions. He has represented clients throughout the country in debtor, committee, senior secured lender, distressed acquisition, and retail/landlord engagements.
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