Contrary to the Bankruptcy Court’s ruling, the District Court concluded that California's liquidated damages statute does not apply to the default interest rate provision.

The U.S. Court of Appeals for the Seventh Circuit allowed a secured creditor to retain its lien and therefore the proceeds from a sale, even after the secured creditor mistakenly released its mortgage lien. The case is Trinity 83 Development, LLC v. ColFin Midwest Funding, LLC (In re Trinity Development, LLC), slip. op. (7th Cir. March 1, 2019).

A U.S. Bankruptcy Court has denied a creditor’s motion for sanctions against a law firm in the Middle District of Florida which the creditor alleged engaged in serial filings.

The U.S. Court of Appeals for the Seventh Circuit recently held that a mortgagee’s failure to take a deficiency judgment against a borrower who filed bankruptcy in a concluded state foreclosure action precluded the mortgagee from making a deficiency claim in the borrower’s bankruptcy proceeding.

A copy of the opinion in BMO Harris Bank N.A. v. Anderson is available at: Link to Opinion.

It is an understatement to say that questionable collateral descriptions in Uniform Commercial Code (“UCC”) financing statements have spawned much litigation over many years. The drafters of the UCC have refined the law of secured transactions in attempt to provide clear guidance to lenders and borrowers on the correct manner to describe collateral in a financing statement. To be blunt, it does not take a great deal of skill or legal acumen to correctly prepare a financing statement, particularly with respect to providing a legally sufficient collateral description.

Rumors of another recession multiplied as the tumultuous second year of the Trump administration came to a close. Highlights of 2018 included a simmering trade war with China; political upheaval after the House of Representatives was retaken by Democrats in the midterm elections; mayhem in financial markets; and, in December, the beginning of the longest government shutdown in U.S. history, triggered by lawmakers’ refusal to provide $5.7 billion in funding for a U.S.-Mexican border wall.

Those who file UCC records often provide the required collateral description on an attached schedule or exhibit rather than the designated field on the financing statement. This well-established and accepted practice can save time in the filing process and reduce transcription errors. When providing the description using an attached document, the financing statement collateral field will typically incorporate the document by reference using words such as “See Schedule A attached” or words to that effect.

There is nothing quite like obtaining a new customer or getting a new big sale - the prospect of recurring revenue from a new source, the validation of business strategy, or the culmination of a successful negotiation.

However, there is nothing more disheartening than when a new customer is unable or unwilling to pay forthe product you just shipped or services you just provided. Perhaps there is one thing that is worse, when a long-term customer fails to pay.

I have been reading Storm Lake, a book by Art Cullen, the editor of the Storm Lake (Iowa) Times and a 2017 Pulitzer Prize winner for editorial writing. In his book, Cullen chronicles the ways that agriculture and his hometown of Storm Lake have been transformed over the years. What strikes me most about the book is how the business cycles of boom and bust still exist in agriculture today and are little changed from when I was growing up on a farm in Iowa decades ago. It appears that we are in or entering a new bust cycle in production agriculture.

Individuals have several options when filing bankruptcy. Chapter 13 is often preferred for individuals with regular income who wish to keep their homes and other secured assets. In a Chapter 13 filing, the court will approve the debtor’s three-to-five-year payment plan, which generally provides for curing any pre-petition delinquency, maintaining payments on secured debt, and a pro rata payment to unsecured creditors based on the debtor’s disposable income. After a Chapter 13 debtor completes his plan, he will receive a discharge of some of his remaining, unpaid debts.