Ocwen Loan Servicing LLC v. Summit Bank, N.A. (In re Francis), 750 F.3d 754 (8th Cir. 2014) –

A lender that attached the wrong legal description to its recorded mortgage sought equitable subrogation and/or reformation of the mortgage in order to obtain a first priority lien on the intended property.

Hardesty v. Mortgage Electronic Registration Systems, Inc. (In re Boothe), 510 B.R. 154 (Bankr. S.D. Ohio 2013) –

A chapter 7 trustee successfully sought to avoid a mortgage using his “strong arm” powers on the basis that the mortgage was not properly acknowledged. Once again a mortgagee paid dearly for sloppy execution of a document.

Far East Nat’l Bank v. U.S. Trustee, San Diego (In re Premier Golf Properties, LP) 477 B.R. 767 (9th Cir. B.A.P. 2012) –

Williams v. City of Milwaukee City Clerk (In re Williams), 473 B.R. 307 (Bankr. E.D. Wis. 2012) –

In re Rosewood at Providence, LLC, 470 B.R. 619 (Bankr. M.D. Ga. 2011) –

The Internal Revenue Service (IRS) recently issued rulings regarding the availability of tax losses after a bankruptcy,1 the ability to take a loss under Sections 165(a) and 165(g),2 and the characterization of a loss after an ownership change.3 There are few rulings or other sources of authority for these types of issues, and thus, a review of these rulings provides insight into the IRS’s current thinking on the issues addressed.

PLR 201051020

On January 14, the Supreme Court ruled that more than a mere retention of estate property is needed for a party to violate the automatic stay, vacating and remanding a decision by the U.S. Court of Appeals for the Seventh Circuit (In re Fulton, 926 F.3d 916 (7th Cir. 2019)) that held that the City of Chicago (City) violated the automatic stay by retaining vehicles that were impounded before the filing of the owners’ bankruptcy petitions. See City of Chi. v. Fulton, 141 S. Ct. 585 (2021). The decision resolved a split among several circuit courts.

Introduction

The Consumer Financial Protection Bureau published its quarterly consumer credit trends report on September 25. In the Report, the CFPB gave an in-depth look at bankruptcy trends and the impact of filing for the period 2001-2018, which includes the enactment of the Bankruptcy Abuse Prevention and Consumer Protection Act (“BAPCPA”) and the Great Recession.

Below are summaries of the noteworthy decisions, laws and requirements impacting the commercial lending industry which occurred or took effect in 2018. Please feel free to contact us for additional information or details on any of the items listed below and/or to discuss whether updates to your loan documents may be needed to address the same.

1. New, Improved Rules for High Volatility Real Estate Loans