Real Estate Litigation and Workouts
Our Real Estate litigators represent clients in a variety of disputes involving real property. Our clients include developers, lessees, buyers, sellers, lenders, title insurance companies, plaintiffs and defendants. Our litigators work closely with our Real Estate attorneys and outside professionals such as appraisers, property managers and accountants to provide a full range of real property litigation services.
Title Claims and Litigation
With respect to title claims work, our firm has a proven reputation. Our real property litigators represent title insurance companys’ insured in numerous title claim disputes involving foreclosures, lien priorities, in rem proceedings, adverse possession claims, easement rights and property damages. Our litigators also represent title insurance companies in actions against their policy coverage.
Our attorneys have worked with, and provided successful representation to, numerous national and regional title companies and agents, including:
- Chicago Title Insurance Company (including Ticor Title Insurance)
- Fidelity National Title Insurance Company
- First American Title Insurance Company
- Industry Partners Title LLC
- Old Republic National Title Insurance Company
- Stewart Title Insurance Company
- Trinity Title & Abstract Corporation
- Young Title Agency
Specific examples of our title claim experience:
- Represented an insured in a mechanic’s lien foreclosure against a contractor who performed work for the defendant’s homeowner who used the insured’s mortgage proceeds to pay off a senior mortgage.
- Represented an insured in a mechanic’s lien foreclosure action regarding the priority of liens that arose out of building loan mortgages.
- Represented an insured in a foreclosure where the defendant’s life estate holder claimed a superior interest to the insured’s interest based on a prior recorded settlement agreement that included a life estate.
- Represented a title company’s insured in an action commenced by a competing mortgage holder regarding property that was reaffirmed in a bankruptcy proceeding.
- Represented a title company’s insured in an action for specific performance and damages regarding property they had purchased that was previously sold under an unrecorded installment agreement by the prior owner who filed a notice of pendency before the insured’s mortgage was recorded.
- Represented a title company’s insured in an action commenced by a neighbor for property damage and trespass to property.
- Represented a title company’s insured in foreclosure actions commenced by competing mortgage lien holders.
- Represented a title company’s insured regarding property improperly sold to New York State without the insured’s permission.
- Represented a title company’s insured by using a lobbyist who was working with the New York State Senate and Assembly to help pass a bill that would remove a reverter clause affecting the insured’s property interest.
- Represented a title company’s insured in an adverse possession claim.
- Negotiated a favorable settlement for a title company’s insured regarding a claim that properties on a subdivision map and deed were improperly described.
- Negotiated a favorable settlement for a title company’s insured in an action to quiet title involving an express easement.
- Negotiated a favorable settlement for a title company’s insured in an action against a power company that flooded the insured’s property.
- Negotiated favorable settlements for a title company’s insured whose ownership interests were jeopardized from in rem tax foreclosure sales when several municipalities failed to notify the insured regarding outstanding taxes.
- Negotiated a favorable settlement for a title company’s insured in a foreclosure action where the mortgage failed to include the correct legal description of the property.
- Represented a title company’s insured regarding a mistake in the recording of a deed and a revocable living trust regarding disputed property.
- Represented a title company’s insured in a negligence action involving a utility company.
- Represented a title company’s insured in an action involving the discharge of a mortgage appearing in the chain of title for property acquired by the insured.
- Represented a title company’s insured in an action challenging the priority of a mortgage where the prior mortgage was unrecorded.
- Represented a title company’s insured in an action challenging the priority of a mortgage where refinance proceeds were misappropriated by the settlement company.
- Represented a title company’s insured by purchasing property at an in rem tax foreclosure sale because an agent failed to locate outstanding taxes owed by the former owner.
Workouts and Foreclosures
In challenging economic real estate cycles, employing creative strategies is of paramount importance. Having represented a diverse client base through many tough business cycles, we have the perspective to skillfully navigate the troubled real estate arena.
Our team of attorneys possesses vast experience and in-depth understanding of the many facets of real estate workouts and foreclosures, including:
- Forbearance agreements
- Judicial and non-judicial foreclosures (real estate and Uniform Commercial Code)
- Lender liability claims
- Receiverships and trusteeships
- Sales of distressed real estate and other assets
Phillips Lytle’s statewide presence, combined with our multidisciplinary team of Real Estate, Banking & Financial Services, Litigation, Environmental, and Bankruptcy & Creditors’ Rights attorneys, position us to be an invaluable asset to our clients.
Real Estate Workouts and Foreclosures Representation:
- Represented a lender in connection with the workout of six related real estate loans secured by federally subsidized housing projects in multiple states. The loans were modified, extended and, in several cases, made the subject of forbearance agreements. The goal of the forbearance agreements was to enable and induce the borrowers to sell or refinance the underlying properties. All but one of the original real estate loans were repaid, in whole or in part, on terms acceptable to the lender.
- Represented a lender in connection with the contested foreclosure of real estate involving protracted litigation. Our responsibilities included bidding at the foreclosure auction, as well as overseeing the sale of the bid and the ultimate settlement with the guarantor.
- Represented a lender in obtaining judgment against a husband and wife. We obtained and enforced an installment order and income execution against the husband and his distributions from his employer. Following the husband’s bankruptcy, settlement was ultimately reached by the sale of a valuable cooperative apartment owned by the husband and wife. The proceeds were then applied to repay the lender.
- Represented a lender in connection with the modification and assumption of various loans secured by real property to a not-for-profit entity. The properties and certain other assets were sold by the original not-for-profit borrower with the consent of the lender, and the loans and underlying mortgages were assumed by the buyer of the properties.
- Represented lenders in the restructuring and liquidation of numerous loans guaranteed by governmental agencies, including the U.S. Small Business Administration 7(a) and 504 loans.
- Represented a lender in the modification of a $100 million syndicated construction loan and handled issues involving public approvals, NYS Brownfield Tax Credits and the modification of failed covenants.
- Represented a lender in a construction loan extension and modification upon the borrower’s failure to obtain building permits.
- Represented a lender in connection with the restructuring of a multi-state loan facility secured by hotel properties located across the northeastern seaboard.
- Represented a lender in connection with a bankruptcy plan of a nationally known hotel chain with indebtedness aggregating more than $250 million.
- Represented a lender in connection with the acquisition of a Long Island, New York office complex. We oversaw the bankruptcy plan of reorganization as well as the resale of the office complex to a New York State Public Benefit Corporation.
- Represented a lender in connection with the structured settlement of claims against certain guarantors, including issues relating to completion of the acquisition of the underlying properties by foreclosure, sales pursuant to bankruptcy plans of reorganization, sales pursuant to Section 363 of the Bankruptcy Code, deeds in lieu of foreclosure, and settlement of deficiency claims.
- Represented a lender with respect to the release of its lien and the restructuring of related indebtedness in connection with the sale of a commercial property in New York City to a municipal agency for the construction of a hospice facility.
- Represented a lender in connection with the foreclosure of a portfolio of properties aggregating more than $100 million, including hotel properties, luxury subdivision developments, multifamily properties, office buildings and shopping centers located across the United States.
- Represented a lender in connection with the restructuring of certain underlying loans to cooperative corporations, including handling negotiations with the sponsors, cooperative corporations and owners’ representatives. Particular attention was paid to issues relating to wraparound mortgages.
- Represented a trustee of securitized loans in connection with the non-judicial foreclosure of commercial space.
- Represented a lender in the acquisition through foreclosure and the settlement of junior liens against certain other parcels involving properties valued at more than $20 million.
- Represented a lender in the restructuring and collateralization of certain loans and letter of credit facilities to a multinational corporation in the amount of more than $50 million – and in the bankruptcy proceedings that later ensued.
- Represented an international investment company’s interest in a securitized facility in a Chapter 11 case involving a timeshare resort lender.
- Represented a lender in the sale of a Manhattan hotel where the lender sponsored the Chapter 11 sale plan.
- Represented a lender in the defense of surcharge and CERCLA claims, as well as the withdrawal of the reference.
Government Agencies and Public Benefit Authorities
- Represented a government agency in the restructuring and foreclosure of a $10 million tax-exempt bond transaction. Our work included handling negotiations with the tax credit investor and competing governmental creditors.
- Represented a public benefit authority in restructuring tax-exempt bonds upon the collapse of the auction-rate interest market.
- Represented a public benefit corporation in the workout of a stalled low-income housing project after the incarceration of the sponsor’s principal.
Corporations and Sports Leagues
- Represented a stainless steel manufacturer in a $72 million fraudulent conveyance. Our work included handling the rejection of collective bargaining agreements under Bankruptcy Code, the injunctive relief of the debtor’s U.S. management against foreign ownership and the violation of fiduciary duties by the board of directors.
- Represented a national footwear company in the confirmation of a Chapter 11 liquidation plan.
- Represented a professional sports league in a Chapter 11 case and on the successful sale of the team to a new owner.
- Represented a purchaser of distressed debt in the recovery of all amounts due under loan documents, including default interest that exceeded the New York statutory rate of interest on a judgment.
- Represented a purchaser in the buying and financing of certain distressed HUD-financed properties valued at more than $60 million.
- Represented a group of institutional investors in the restructuring and collateralization of revolving term credit loans to several U.S. manufacturers, each in the amount of more than $100 million.
Letter of Credit and Bond Issuers
- Represented a letter of credit issuer in a tax-exempt bond transaction when the borrower failed to secure a replacement letter of credit.
- Represented a letter of credit issuer in connection with low floater bonds that failed to be remarketed.
- Represented an issuer in exchange offers for subordinated debt in amounts of more than $20 million.
- Represented the FDIC in the workout and foreclosure of a portfolio of several hundred cooperative apartment loans.
- Represented a developer in connection with the negotiation, settlement and performance of covenants in satisfaction of obligations under loan guaranties.
- Represented a developer in several restructurings, collateralizations and refinancings of a Manhattan construction project with an ultimate completion cost of approximately $175 million.
- Represented a condominium developer in matters involving the restructuring of debt with senior and junior lenders, the satisfaction of trade creditors claims, the application of existing collateral, and the infusion of new capital to cure defaults and complete projects with a total construction budget of more than $50 million.
- Represented a bankruptcy trustee in connection with the sale of two portfolios of properties held by tenants-in-common, one of which was in bankruptcy. Included were commercial and retail properties on Long Island and the five boroughs of New York City, warehouse properties in New Jersey and oceanfront lots in West Palm Beach. One portfolio was sold through the negotiation of a purchase and sale agreement with a “white knight.” The sale of the other portfolio was through the negotiation of detailed term sheets for seven alternative proposals which were submitted to the tenants-in-common for approval and then confirmed by the bankruptcy court.
- Represented a bankruptcy trustee in connection with the agreement of a merger agreement covering a real estate holding corporation.
- Represented court-appointed receivers of hotels and office buildings.
Our attorneys represent institutional and private lenders in commercial mortgage foreclosures. We are highly experienced in quickly controlling and preserving income streams from commercial properties owned by defaulting mortgagors. We also work with our clients to explore and implement favorable and creative workout strategies whenever appropriate.
Tax Assessment Challenges, Eminent Domain and Condemnation Proceedings
Our Real Estate Litigation and Workouts attorneys represent both real property owners and municipalities in litigation involving the determination of the fair market value of real properties for ad valorem tax, eminent domain and condemnations. We have represented a diverse group of clients in real property valuation litigation, including owners of large industrial properties, commercial properties, apartment buildings, parking garages and individual residences.
In Rem Tax Foreclosures
Our in rem tax lien enforcement attorneys represents governmental taxing authorities, national syndicates and purchasers of tax liens in lien foreclosures throughout New York State – where we are one of the largest providers of this service./